This book is intermediate financial management by Brigham and Daves 12th. this problem is ch 8 and P.344(problem 24).

Do you have a soluttion?

Hamilton Landscaping's dividend growth rate is expected to be 30% in the next year, drop to 15% from Year 1 to Year 2, and drop to a constant 5% for Year 2 and all subsequent years, Hamilton has just paid a dividend of $2.50 and its stock has a required return of 11% a. What is Hamilton's estimated stock price today? $2.50 11.0% 30% 15% 5% Do 90.1 g1,2 Short-run g, for Year 1 only Short-run g, for Year 2 only Long-run g, for Year 3 and all following years 30% 15% 5% 5% 9 Year Dividend PV of dividends and PV of horizon value = D2 (1+g) = D3 = Horizon value P2 =