A company currently pays a dividend of 84 per share (D. 54). It is estimated...
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A company currently pays a dividend of 84 per share (D. 54). It is estimated that the company's dividend will grow at a rate of 10% per year for the next 3 years and then a constant rate of 5% thereafter, The company's stock has a beta of 1.5, the risk-free rate is 4%, and the market risk premium is 4%. What is the company's required rate of return on its stock? (5 points) b. What are the expected dividends for Your 1. Year 2, Year 3, and Your 4? (5 points) c. What is the company's horizon value on Year 3? (5 points) What is the estimate of the stock's current price? (5 points) For the toolbar, press ALT-F10 (PC) or ALT-FN-F10 (Mac). B TVS Paragraph Arial
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