Evaluate current price of the common stock


Church Inc. is presently enjoying relatively high growht because of a surge in the deman for its new product. Management expects earning and dividends to grow at a rate of 25% for the next 4 years, ater which competition will probalby reduce the growth rate in earning and dividends to zero, ie g= 0. The company's last dividend, Do was 1.25 its beta is 1.20. the market risk premium is 5.5% and the risk-free rate is 3%. What is the current price of the common stock

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Finance Basics: Evaluate current price of the common stock
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