Page 64 - FINAL CFA I SLIDES JUNE 2019 DAY 12
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Session Unit 14:
49. Equity Valuation: Concepts and Basic Tools
Example: Multistage growth: Consider a stock with dividends that are expected to grow at 20% per year
for four years, after which they are expected to grow at 5% per year, indefinitely. The last dividend paid
was $1.00, and k = 10%. Calculate the value of this stock using the multistage growth model.
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