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Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay div
Posted: Sun Jul 03, 2022 12:52 pm
by answerhappygod
- Computech Corporation Is Expanding Rapidly And Currently Needs To Retain All Of Its Earnings Hence It Does Not Pay Div 1 (8.78 KiB) Viewed 10 times
Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay dividends. However, investors expect Computech to begin paying dividends, beginning with a dividend of $1.75 coming 3 years from today. The dividend should grow rapidly - at a rate of 45% per year - during Years 4 and 5, but after Year 5, growth should be a constant 4% per year. If the required return on Computech is 12%, what is the value of the stock today? Do not round intermediate calculations. Round your answer to the nearest cent.