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ProMax Co.s common stock is currently selling for $36 per share. The firm is expected to pay $4 per share dividend next year and its
ProMax Co.s common stock is currently selling for $36 per share. The firm is expected to pay $4 per share dividend next year and its earnings are expected to grow at 9% per year in the future. If investors require 19% rate of return on this stock, explain with calculation whether the value of the stock is more or less than its market price? is it overpriced or underpriced? should investor purchase this stock?
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