Compute the intrinsic value of the stock

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Reference no: EM132019587

Suppose that a stock's current dividend is equal to $1.50. Also, suppose that the stock will grow at 7% for the first 3 years, then at 6% for 3 more years, and then at 5% thereafter.

Also, assume that the opportunity cost rate of the stock (estimated via CAPM) is equal to 11%. What is the intrinsic value of the stock?

Reference no: EM132019587

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