Squidward Tentacles & Co. will pay an annual dividend of $0.65 one year from now. The dividend is expected to grow at a 12% rate for the next 4 years and then settle down to a steady growth rate of 2% per year in perpetuity. If Squidward Tentacle’s required rate of return is 8%, what is the current value of a share of stock?
$11.80
$15.07
$17.33
$18.05
$20.62