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Stock Valuation

How do I calculate this example problem below?

Suppose a firm just paid a dividend of $10 per share. Future dividends are expected to increase at a 5% annual rate. The required return is 25% per year. The value of the firm is estimated as:

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The stock price is the present value of all dividends. Since the dividends are expected to increase at a constant rate, we use the constant growth ...

Solution Summary

The solution explains how to calculate the stock price using the dividend discount model

$2.19