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41 Suppose the risk-free rate is 1.17% and an analyst assumes a...

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Finance

41

Suppose the risk-free rate is 1.17% and an analyst assumes a market risk premium of 5.71%. Firm A just paid a dividend of $1.03 per share. The analyst estimates the of Firm A to be 1.40 and estimates the dividend growth rate to be 4.38% forever. Firm A has 263.00 million shares outstanding. Firm B just paid a dividend of $1.56 per share. The analyst estimates the of Firm B to be 0.76 and believes that dividends will grow at 2.17% forever. Firm B has 199.00 million shares outstanding. What is the value of Firm B?

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