Reflect windfall from completion of major successful project

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Reference no: EM132008817

XYZ firm plans to pay three annual special dividends of $1 per share over the next three years to reflect the windfall from the completion of a major successful project. Thereafter, starting exactly four years from today, the firm plans to pay a dividend of $2.21 and increase that dividend by 2.68% per year indefinitely. Assuming a discount rate of 10.63%, calculate the intrinsic value of XYZ firm's stock today.

Reference no: EM132008817

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