Your boss, Taylor Maloney, treasurer of Fred Clark Enterprises (FCE), asked you to help her estimate the intrinsic value of the company's stock. FCE just paid a dividend of $2.50, and the stock now sells for $17.00 per share. Taylor asked a number of security analysts what they believe FCE's future dividends will be based on their analysis of the company. The consensus is that the dividend will be increased by 10% during Years 1 to 3, and it will be increased at a rate of 5% per year in Year 4 and thereafter. Taylor asked you to use that information to estimate the required rate of return on the stock, ts, and she provided you with the following template for use in the analysis. Estimated ts 20.00% (must be changed to force Calculated Price to equal the Market Price Actual Market Price. Po: $17.00 Year Rapid growth 2 Normal growth 5 0 3 4 106 TOM TOS 09 5 54 5250 2 2 Dividend growth rate (insert correct values) calculated dividends (Do has been paid HV3.DA/E-84). Find using Estimated Total CFS PVS of CFs when discounted at Estimated ES Calculated Price. Po + sum of PVS 3 50.00 A positive number will be here when dividends are estimated The Calculated Price will equal the Actual Market Price once the correct has been found, Taylor told you that the growth rates in the template were just put in as a trial and that you must replace them with the analysts' forecasted rates to get the correct forecasted dividends and then the estimated HV She also note that the estimated value for rs at the top of the template, is also just a guess, and you must replace it with a value that will cause the calculated Price shown at the bottom to equal the Aetaal Market Price. She suggests that, after you have put in the correct dividends, you can manually calculate the price using a series of guesses as to the Estimated to. The value of ts that causes the calculated price to equal the actual price is the correct one. She notes, though, that this trial and error process is quite tedious, and that the correct rs could be found much faster with a simple Excel model, especially if you case Goal Seek. What the value of O 20:46% 0 25.39% c. 22:43 O d. 18.98% 21.90% Your boss, Taylor Maloney, treasurer of Fred Clark Enterprises (FCE), asked you to help her estimate the intrinsic value of the company's stock. FCE just paid a dividend of $2.50, and the stock now sells for $17.00 per share. Taylor asked a number of security analysts what they believe FCE's future dividends will be based on their analysis of the company. The consensus is that the dividend will be increased by 10% during Years 1 to 3, and it will be increased at a rate of 5% per year in Year 4 and thereafter. Taylor asked you to use that information to estimate the required rate of return on the stock, ts, and she provided you with the following template for use in the analysis. Estimated ts 20.00% (must be changed to force Calculated Price to equal the Market Price Actual Market Price. Po: $17.00 Year Rapid growth 2 Normal growth 5 0 3 4 106 TOM TOS 09 5 54 5250 2 2 Dividend growth rate (insert correct values) calculated dividends (Do has been paid HV3.DA/E-84). Find using Estimated Total CFS PVS of CFs when discounted at Estimated ES Calculated Price. Po + sum of PVS 3 50.00 A positive number will be here when dividends are estimated The Calculated Price will equal the Actual Market Price once the correct has been found, Taylor told you that the growth rates in the template were just put in as a trial and that you must replace them with the analysts' forecasted rates to get the correct forecasted dividends and then the estimated HV She also note that the estimated value for rs at the top of the template, is also just a guess, and you must replace it with a value that will cause the calculated Price shown at the bottom to equal the Aetaal Market Price. She suggests that, after you have put in the correct dividends, you can manually calculate the price using a series of guesses as to the Estimated to. The value of ts that causes the calculated price to equal the actual price is the correct one. She notes, though, that this trial and error process is quite tedious, and that the correct rs could be found much faster with a simple Excel model, especially if you case Goal Seek. What the value of O 20:46% 0 25.39% c. 22:43 O d. 18.98% 21.90%