Answer:
$68.23
Explanation:
In this question, we apply the dividend growth rate model which is shown below:
The computation of the current share price is shown below:
= (Current year dividend) ÷ (Rate of return on company stock - growth rate)
= ($4.23) ÷ (10.6% - 4.4%)
= ($4.23) ÷ (6.2%)
= $68.23
We simply find out the ratio between the current year dividend per share and difference between the rate of return and the growth rate
