What do you estimate the firm current stock price to be

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Reference no: EM133435941

Question: Laurel Enterprises expects earnings next year of $3.96 per share and has a 50% retention rate, which it plans to keep constant. Its equity cost of capital is 11%, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 5.5% per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be? The current stock price will be ?

Reference no: EM133435941

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