Shellbridge Corporation common stock has a par value of $25 and recently paid a dividend of $4.76 per share. The firm's dividends have grown from $1.50 to $4.76 over the past 10 years, which also reflects the expected growth in dividends for the indefinite future. The stock is selling for $40 and you think a reasonable required rate of return is 15%. What is the stock's intrinsic value? O $172.46 O $193.57 $31.73 $35.62 O $101.86

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Shellbridge Corporation common stock has a par value of $25 and recently paid a dividend of $4.76 per share. The
firm's dividends have grown from $1.50 to $4.76 over the past 10 years, which also reflects the expected growth in
dividends for the indefinite future. The stock is selling for $40 and you think a reasonable required rate of return is
15%. What is the stock's intrinsic value?
O $172.46
O $193.57
$31.73
$35.62
O $101.86
Transcribed Image Text:Shellbridge Corporation common stock has a par value of $25 and recently paid a dividend of $4.76 per share. The firm's dividends have grown from $1.50 to $4.76 over the past 10 years, which also reflects the expected growth in dividends for the indefinite future. The stock is selling for $40 and you think a reasonable required rate of return is 15%. What is the stock's intrinsic value? O $172.46 O $193.57 $31.73 $35.62 O $101.86
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