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What is your estimate of the stock current price

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Reference no: EM133149580

Question - A company currently pays a dividend of $3 per share (D0 = $3). It is estimated that the company's dividend will grow at a rate of 20% per year for the next 2 years, and then at a constant rate of 5% thereafter. The company's stock has a beta of 1.8, the risk-free rate is 9%, and the market risk premium is 4.5%. What is your estimate of the stock's current price?

Reference no: EM133149580

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