Multi-Stage Growth Equity Valuation (35 points) Balthrop Corp common stock currently trades at $36.80 and just paid a dividend (Do) of $6.44 due to an unexpectedly large oil field success. Dividends are expected to grow for 3 years at 10% per year before decreasing sharply. The growth rate in dividends for the next 3 years after that (years 4-7) is 20%, and then dividends will decrease at 1% annually forever. Balthrop Corp is best modeled using a 2 lactor model where expected returns take the following form: kr + Biru) + Balr. (1) Assume the risk free rate is 0%, B 0.2, Ba 1.3, and the excess returns of the factors are (mm) 10% and (-) 20%. Question 5.3: (10 Points) Calculate the current value of a share of Balthrop Corp stock and determine it is over or under valued