Question
The Radio Company's last dividend was $1.75 (D 0 = $1.75). Its dividend growth rate is expected to be constant at 25% (.25) for 2
The Radio Company's last dividend was $1.75 (D0 = $1.75). Its dividend growth rate is expected to be constant at 25% (.25) for 2 years, after which dividends are expected to grow at a rate of 6% (.06) forever. Its required return (rs) is 12% (.12). What is the current value of the stock per share if the stock sells for its equilibrium price?
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International Finance Putting Theory Into Practice
Authors: Piet Sercu
1st edition
069113667X, 978-0691136677
