ps29 5

Suppose the risk-free rate is 3.93% and an analyst assumes a market risk premium of 5.21%. Firm A just paid a dividend of $1.06 per share. The analyst estimates the of Firm A to be 1.38 and estimates the dividend growth rate to be 4.43% forever. Firm A has 265.00 million shares outstanding. Firm B just paid a dividend of $1.78 per share. The analyst estimates the of Firm B to be 0.80 and believes that dividends will grow at 3.00% forever. Firm B has 198.00 million shares outstanding. What is the value of Firm B?