What would be a fair value today for the shares

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Question - You are an investor currently considering purchasing shares of Lazz Co. You expect them to pay a dividend of $2.13 a share and those dividends to grow at 2% a year indefinitely, however, you don't expect that first dividend of $2.13 until the end of year 4. Based on your analysis, what would be a fair value today for the shares of Lazz Co. given a 50% Debt to Cap ratio, a 3% after tax cost of debt and a 6% cost of equity?

A) $29.81

B) $35.50

C) $44.71

D) $53.25

Reference no: EM133183126

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