XYZ corp expects to earn

$4.8

per share next year and plow back

47.92%

of its earnings (i.e., it expects to pay out a dividend of

$2.5

per share, representing

52.08%

of earnings). The dividends are expected to grow at a constant sustainable growth rate and the stocks are currently priced at

$30

per share. How much of the stock's

$30

is reflected in Present Value of Growth Opportunities (PVGO) if the investors' required rate of return is

20%

?

$

XYZ corp expects to earn $4.8 per share next year and plow back 47.92% of its earnings (i.e., it expects to pay out a dividend of $2.5 per share, representing 52.08% o earnings). The dividends are expected to grow at a constant sustainable growth rate and the stocks are currently priced at $30 per share. How much of the stock's $3 is reflected in Present Value of Growth Opportunities (PVGO) if the investors' required rate of return is 20\%? \$