Magnetic Corporation expects dividends to grow at a rate of 15.8% for the next two years. After two years dividends are expected to grow at a constant rate of 5.7%, indefinitely. Magnetic’s required rate of return is 11.1% and they paid a $1.37 dividend today. What is the value of Magnetic Corporation’s common stock per share? (Show your answers to the nearest cent)
Dividend at end of year 1 =
Dividend at end of year 2 = ____________
Dividend at end of year 3 = ____________
Price of stock at end of year 2 = _____________
Price of stock today = __________