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XY company Just paid a dividend of $2.50 per share. The company will increase its dividend by 8 percent next year and will then reduce
XY company Just paid a dividend of $2.50 per share. The company will increase its dividend by 8 percent next year and will then reduce its dividend growth rate by 2 percents points per year until it reaches the industry average of 2 percent dividend growth, after which the company will keep a constant growth rate forever. What is the price of this stock today given a required return of 12 percent?
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