Dividend policy should reflect company high growth strategy

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Reference no: EM131907814

Berry Corp. just paid an annual dividend of $2.35. The Board of Directors at Berry Corp. decides that its dividend policy should reflect the company’s high growth strategy. Yearly dividends will increase at a rate of 5% per year over the first three years, then will increase at a rate of 3% for the fourth year, and finally grow at 2% per year thereafter. How much should you pay for such a stock if you expect a 4% annual rate?

Reference no: EM131907814

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