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Youve collected the following information from your favorite financial website. 52-Week Price Stock (Div) Div Yld % PE Ratio Close Price Net Chg Hi Lo

Youve collected the following information from your favorite financial website.

52-Week Price Stock (Div) Div Yld % PE Ratio Close Price Net Chg
Hi Lo
77.40 10.43 Palm Coal .36 2.6 6 13.90 .24
55.81 33.42 Lake Lead Grp 1.54 3.8 10 40.43 .01
131.12 70.45 SIR 2.95 3.3 10 89.16 3.07
50.24 13.95 DR Dime .80 5.2 6 15.43 .26
35.00 20.74 Candy Galore .32 1.5 28 ?? .18

According to your research, the growth rate in dividends for SIR for the next five years is expected to be 21 percent. Suppose SIR meets this growth rate in dividends for the next five years and then the dividend growth rate falls to 5.75 percent indefinitely. Assume investors require a return of 15 percent on SIR stock.

According to the dividend growth model, what should the stock price be today?

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