Fast Growth Co. is expected to pay a dividend in year 1 of $1.00, a dividend in year 2 of $2.00, and a dividend in year
Posted: Wed Jul 06, 2022 6:44 pm
Fast Growth Co. is expected to pay a dividend in year 1 of $1.00, a dividend in year
2 of $2.00, and a dividend in year 3 of $3.00. After year 3, dividends are expected to grow at the
rate of 10% per year (i.e. dividend of $3.30 in year 4, $3.63 in year 5...). An appropriate required
return for the stock is 12%. Using the multistage DDM, what is the stock’s worth today?
Please do not answer this question using excel.
2 of $2.00, and a dividend in year 3 of $3.00. After year 3, dividends are expected to grow at the
rate of 10% per year (i.e. dividend of $3.30 in year 4, $3.63 in year 5...). An appropriate required
return for the stock is 12%. Using the multistage DDM, what is the stock’s worth today?
Please do not answer this question using excel.