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Southern Foods just paid an annual dividend of $1.15 a share. Management estimates the dividend will increase by 8 percent a year for the next
Southern Foods just paid an annual dividend of $1.15 a share. Management estimates the dividend will increase by 8 percent a year for the next four years. After that, the annual dividend growth rate is estimated at 4 percent. The required rate of return is 14 percent. What is the value of this stock today? Use Two-Stage Dividend Growth Model.
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