Storico Co. just paid a dividend of $1.85 per share. The company will increase its dividend by 24 percent next year and will then reduce its dividend growth rate by 6 percentage points per year until it reaches the industry average of 6 percent dividend growth, after which the company will keep a constant growth rate forever. If the required return on the company's stock is 14 percent, what will a share of stock sell for today? (Do not round intermediate calculations and round your answer to 2 decimal places, e. g., 32.16.)
Answers: 2
![\left[\begin{array}{ccc}Year&cashflow&PV\\&1.85&\\1&2.294&2.0123\\2&2.70692&2.0829\\3&3.0317504&2.0463\\3&40.1706928&27.1141\\&TOTAL&33.2556\\\end{array}\right]](/tpl/images/0537/9772/b3886.png)
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Storico Co. just paid a dividend of $1.85 per share. The company will increase its dividend by 24 pe...
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