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What is the present value of share

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Takuma is valuing the stock of the Paloma Company which manufactures machine tools. The firm is just about to pay a dividend of $2 per share. This is expected to grow at 15% a year for five years, 10% a year for the ten years after that before finally settling down to a growth rate of 5% per year for ever after that. The market capitalization rate of similar stocks is 8%. What is the present value of each share?

Reference no: EM133123722

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