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please do all parts 2) Last year XYZ Company paid a dividend of $2.00 on its common stock. Due to favorable growth opportunities, both dividends

please do all parts image text in transcribed
2) Last year XYZ Company paid a dividend of $2.00 on its common stock. Due to favorable growth opportunities, both dividends and earnings are expected to grow at 25%for the next three years. After that, normal growth of 4% is expected for the foreseeable future. XYZ stock has a beta of 1.2; last year the stock market had a retum of 10% and the risk free rate is 3%. a) What's the required rate of return for XYZ Company under CAPM? b) Calculate the first three years' dividend (D1, D2 and D3) c) Calculate the stock value (P3) at end of third using Constant Growth Dividend Model d) Using the 2-stage Dividend Discount Model, what's the value of the stock today

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