Estimate the intrinsic value of its common shares

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Reference no: EM131130670

Firm A just paid a dividend of $2.50 per share. This dividend is expected to grow at a rate of 18% over the next three years and then grow at a rate of 3% after that into the foreseeable future. If Firm A’s cost of equity is 11 percent, estimate the intrinsic value of its common shares today.

Reference no: EM131130670

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