Suppose that Skecher s stock paid a dividend of $1.80 last year and that the dividend is expected to remain constant. Skecher s beta is 1.74, the current risk-free rate is 1.2% and the market risk premium is 5.7%. What is the intrinsic value of Skecher s stock?
a $19.93
b $16.19
c None of these
d $10.34
e $20.65