Walmart has just paid an annual dividend of $3.46. Dividends are expected to grow by 7% for the next 4 years, and then grow by 5% thereafter. Walmart has a required return of 6%.

(Note the wording of this problem. Typically, when a problem says "expected to grow for the next X years", they mean that the the cashflow will grow constantly up to the end of year X, then the cashflow at year X will grow at some other rate in years X+1, X+2 etc.)

Part1

What is the expected dividend in four years?

Part2

What is the terminal value in four years (P4)?

Part3

What is the value of the stock now?