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Whats the current stock price for a firm that is expected to have extraordinary growth of 25% for the first 2 years and 20% growth
Whats the current stock price for a firm that is expected to have extraordinary growth of 25% for the first 2 years and 20% growth for the next 2 years, after which it will face more competition and slip into a constant-growth rate of 5%? Its required rate of return is 14% and next year's dividend is expected to be $5.00. Whats your rate of return for the investment if you purchase the stock now and sell it one year later, assuming the discount rate will be 12% next year?
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