Estimate the firm current stock price to be

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Reference no: EM132071547

Laurel Enterprises expects earnings next year of $3.82 per share and has a 50 % retention rate, which it plans to keep constant. Its equity cost of capital is 9 %, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 4.5 % per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be?

Reference no: EM132071547

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