Estimate of the stock current price

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A company, GameMore, has just paid a dividend of $3 per share, D0=$ 3 . It is estimated that the company's dividend will grow at a rate of 16% percent per year for the next 2 years, then the dividend will grow at a constant rate of 7% thereafter. The company's stock has a beta equal to 1.4, the risk-free rate is 4.5 percent, and the market risk premium is 4 percent. What is your estimate of the stock's current price? Round your answer to two decimal places.

Reference no: EM132348649

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