Find what is per-share estimate of stock intrinsic value

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Nonconstant growth valuation

Problem 1: Hiers Industries just paid a dividend of D = $3.00. Analysts expect the company's dividend to grow by 10% this year, by 5% in Year 2, and at a constant rate of 3% in Year 3 and thereafter. The required return on this stock is 9.00%. What is the per-share estimate of the stock's intrinsic value?

a. $50.00

b. $53.33

c. $54.76

d. $56.01

e. $59.48

Reference no: EM132968679

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