How much should the companys store be trading

Reference no: EM133290992

Question: Lebron Jason Inc. just pald a dividend (Da) of $3.00/share. The firm's dividend payment is expected to undergo fast growth for three years in a row at 85% each year (between tO and t-3); then the firm's dividend will grow at A0% each year for 2 more years (between t-3 and t-5) until it slows down to a permanent growth rate of 4% per year forever.

Thanks to the aggressive rate hiking by the Fed, the required rate of return (discount rate) is 15% between tO and t-2, but increase lo
20% between t-2 and t-4, and further increases to 25% beyond ta4.

Based on the dividend discount model, how much should the company's store(per share) be trading, at? (Show all your work fo
credit; If you give me the correct final answer without any steps showing work, you would be assigned a zero)

Reference no: EM133290992

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