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X - Ray Inc. recently paid its annual dividend of $ 2 . 8 2 , and reported an ROE of 5 % . The

-

Ray Inc. recently paid its annual dividend of $

2.82,

and reported an ROE of

5 % .

The firm pays out

50 %

of earnings as dividends. Based on your analysis, you estimate that the stock has a required return of

20 % .

What is the intrinsic value of this stock?

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