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PROBLEM # 8 ( 5 Points ) Panther City Pharmaceuticals ( Motto: Making drugs guaranteed to change your life and maybe your genes ) stock

PROBLEM #8
(5 Points)
Panther City Pharmaceuticals (Motto: Making drugs guaranteed to change your life and maybe your genes) stock has a required rate of return of 15.0%. The firm has an impressive growth rate in earnings and dividends forecast until 2027. Unfortunately, this rapid growth rate is expected to end in three years due to increased competition and ending patent protection. Earnings and dividends are expected to grow at a constant and sustainable growth rate of 6.0 percent after 2027. Based on 2024's dividend paid last week, analysts have prepared the following forecast of dividends and third-year stock price. Given these projections, what is Panther City's equilibrium stock price today?
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