Problem:
T.G. Jackson recently took his company through an inital public offering. He is expanding the business quickly to take advantage of an otherwise unexploited market. Growth for his comany is expected to be 30 percent for the first three years and then he expects it to slow down to a constant 12 percent. The most recent dividend (D0) was $0.60. Based on the most recent returns, the beta for his company is approximately 1.5. The risk free rate is 6 percent and the market risk premium is 5 percent.
Required:
Question: What is the current price of Lee's stock?
Note: Please show basic calculation