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May 24, 2015

Homework Help: finance

Posted by todd on Thursday, December 29, 2011 at 6:18pm.

Company sales and profits grow at a rate of 30% per year; at the end of 4 years (t4) the growth rate drops to steady 5%. Company recently paid a dividend of $1 per share, and the required return is 20%. What is the value of one share today (t0)? assuming dividends grow at same rate as earnings after year 4.

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