Question:Problem 9-2 Constant growth valuationThomas Brothers is expected to pay a $3.8 per share dividend at the end of...
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Question:
Problem 9-2
Constant growth valuation
Thomas Brothers is expected to pay a $3.8 per share dividend at the end of the year (that is, D1 = $3.8). The dividend is expected to grow at a constant rate of 4% a year. The required rate of return on the stock, rs, is 18%. What is the stock's current value per share? Round your answer to two decimal places.
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