Assume Highline Company has just paid an annual dividend of $1.06. Analysts are predicting an 11.8% per year growth rate

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Assume Highline Company Has Just Paid An Annual Dividend Of 1 06 Analysts Are Predicting An 11 8 Per Year Growth Rate 1 (54.57 KiB) Viewed 23 times

Assume Highline Company has just paid an annual dividend of $1.06. Analysts are predicting an 11.8% per year growth rate in earnings over the next five years. After then, Highline's earnings are expected to grow at the current industry average of 5.6% per year. If Highline's equity cost of capital is 7.9% per year and its dividend payout ratio remains constant, for what price does the dividend-discount model predict Highline stock should sell? The value of Highline's stock is $. (Round to the nearest cent.)