Problem:
Nachman Industries just paid a dividend of D0 = $1.32. Analysts expect the company's dividend to grow by 25% this year, by 12% in Year 2, and at a constant rate of 4% in Year 3 and thereafter. The required return on this low-risk stock is 9.00%.
Required:
Question: What is the best estimate of the stocks current market value?
Note: Please explain comprehensively and give step by step solution.