# 4 O A stock just paid a dividend of $1.27. The dividend is expected to grow at 23.94% for five years and then grow at 4.73% thereafter. The required return on the stock is 10.65%. What is the value...

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Extracted text: # 4 O A stock just paid a dividend of $1.27. The dividend is expected to grow at 23.94% for five years and then grow at 4.73% thereafter. The required return on the stock is 10.65%. What is the value of the stock? Submit Answer format: Currency: Round to: 2 decimal places. unanswered not_submitted Attempts Remaining: Infinity


Extracted text: B D E F G H 1 DO 2 Growth rate 1-5 3 Growth rate after 5 $2.31 25.18% 4.79% 4 Ke 14.43% 5 Year 1 3. 6. 7 Expected Dividend 8 PV factor 9 Ke-g 10 Discounted Dividend $2.891658 $3.6197774844 S4.5312374550 S5.6722030461 $7.1004637732 $7.4405759879 1.9620021985 0.0964 $2.5270103994 $2.7644076011 $3.0241068208 $3.3082031970 $3.6189886935 $39.3396084223 $2.31 1.1443 1.30942249 1.4983721553 1.7145872573 1.9620021985 11 Value of stock $54,58 Formula snip: D E F G H 1 DO 2 Growth rate 1-5 2.31 0.2518 3 Growth rate after 5 0.0479 4 Ke 0.1443 Year 4 =E7*(1+B2) =(1+14.43%)^1 =(1+14.43%)^2 =(1+14.43%)^3 =(1+14.43%)^4 =(1+14.43%)^5 =(1+14.43%)^5 1 15 |=F7*(1+B2) 6 =G7*(1+B3) 6 7 Expected Dividend 8 PV factor 9 Ke-g 10 Discounted Dividend 11 Value of stock |=B1 |=B7*(1+B2) =C7*(1+B2) |=D7*(1+B2) =14.43%-4.79% |=H7/(H8*H9) =C7/C8 =D7/D8 =E7/E8 =F7/F8 =G7/G8 |=SUM(C10:H10) Hence, value of stock is $54.58.