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The Miller Corp. will pay an annual dividend of $1.50 one year from now. Analysts expect this dividend to grow at 12% per year thereafter

The Miller Corp. will pay an annual dividend of $1.50 one year from now.

  • Analysts expect this dividend to grow at 12% per year thereafter until the 3rd year.
  • After then, growth will level off at 4% per year forever.

What is the value of its stock today if the firm’s required return is 20%?

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Heres how to calculate the value of the Miller Corp stock today Step 1 Define Variables Dividend year 1 D1 150 Growth rate years 1 to 3 g13 12 as a de... blur-text-image

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