ROBLEM #$8$

$(5$ Points$)$

Panther City Pharmaceuticals $($Motto: Making drugs guaranteed to change your life and maybe your genes$)$ stock has a required rate of return of $15\mathrm{.}0\%.$ 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 $6\mathrm{.}0$ percent after $2027.$ Based on $2024\text{'}$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?

$\backslash$table$[[D_{2024}=D_0,$$$1,1\mathrm{.}00],[D_{2025}=D_1,$$$1,1\mathrm{.}50],[D_{2026}=D_2,$$$2\mathrm{.}10,],[D_{2027}=D_3,$$$2\mathrm{.}52,],[P_{2027},=P_3,$$$29\mathrm{.}68$