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The companys stock consists of a beta equal to 195 the

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A company currently pays a dividend of $3.5 per share, D0 = 3.5. It is estimated that the company's dividend will grow at a rate of 19% percent per year for the next 2 years, then the dividend will grow at a constant rate of 7% thereafter. The company's stock has a beta equal to 1.95, the risk-free rate is 6.5 percent, and the market risk premium is 5 percent. What is your estimate is the stock's current price? Round your answer to the nearest cent.

Reference no: EM13476925

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