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Compute the value of the stock today

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Reference no: EM131606562

Discussion

ABC Company recently paid a dividend of $2.25 per share. The dividend is expected to grow at a rate of 15% for the next 4 years and then decline linearly over the next 8 years to a constant growth rate of 5% into perpetuity. Given a required rate of return of 1 1 %, calculate the value of the stock today.

Reference no: EM131606562

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