Problem:
Ocala company's stock is currently selling for $19.50 per share. At the end of the year, the company plans to pay a dividend equal to $2.34 per share. For the remainder of the company's life, dividends are expected to grow at a constant rate, and investors are expected to require a 16 percent return to invest in ocala's stock.
Required:
Question: What should be the value of ocala's stock five years from now?
Note: Please explain comprehensively and give step by step solution.