70.2K
Verified Solution
Link Copied!
Assume Gillette Corporation will pay an annual dividend of
$0.62
one year from now. Analysts expect this dividend to grow at
11.3%
per year thereafter until the
4th
year. Thereafter, growth will level off at
2.3%
per year. According to the dividend-discount model, what is the value of a share of Gillette stock if the firm's equity cost of capital is
7.6%?
Answer & Explanation
Solved by verified expert
