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Sam Co. just paid a dividend of $2.65 per share. The company will increase its dividend by 10% next year and will then reduce its
Sam Co. just paid a dividend of $2.65 per share. The company will increase its dividend by 10% next year and will then reduce its dividend growth rate by 2 percentage points per year until it reaches the industry average of 4% dividend growth, after which the company will keep a constant growth rate forever. If the required return on Sam Co. stock is 10%, what will a share of stock sell for today?
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