Calculate the economic value of the stock now

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Reference no: EM131581422

At the end of the year 2016 Brown Bear Corporation paid dividends $2.70 per share. The company projects the following annual growth rates in dividends:

           Year    Growth Rate

            2017    13%

            2018    13%

            2019    13%

            2020    9%

            2021    9%

            2022    6%

From year 2023 onward growth in dividends is expected to remain constant at 2% per year. The required rate of return for this stock is 8.00%.

Calculate the economic value of the stock now (end of the Year 2016).

Reference no: EM131581422

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