Calculate intrinsic value of firm stock today

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Reference no: EM132014830

XYZ firm plans to pay three annual special dividends of $1 per share over the next three years to reflect the windfall from the completion of a major successful project. Thereafter, starting exactly four years from today, the firm plans to pay a dividend of $2.11 and increase that dividend by 1.46% per year indefinitely. Assuming a discount rate of 10.55%, calculate the intrinsic value of XYZ firm's stock today.

Reference no: EM132014830


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