Estimate of the stock current market value

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Nachman Industries just paid a dividend of D0 = $1.42. Analysts expect the company's dividend to grow by 30% this year, by 10% in Year 2, and at a constant rate of 4% in Year 3 and thereafter. The required return on this stock is 8.00%. What is the best estimate of the stock's current market value?

I was going to take the Do of (1.42) ^4 x 30% then 1.42^4x10%, and then add both answers and divide by 8%.

Reference no: EM132389632

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