Question 3 (10 marks) Storico Co. just paid a dividend of $3.85 per share. The...
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Question 3 (10 marks) Storico Co. just paid a dividend of $3.85 per share. The company will increase its dividend by 20 percent next year and will then reduce its dividend growth by 5 percentage points per year until it reaches the industry average of 5 percent dividend growth, after which the company will keep a constant growth rate forever. If the required rate of return on Storico stock is 13 percent, what will a share of stock sell for today? 7
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