Answer:
The maximum amount that an onvestor would be willing to pay for the stock today is $76.47
Explanation:
The constant growth model of the dividend growth adn DDM aproach will be used to calcualte the value of the stock as its dividends will grow by a constant percentage forever.
The price of the stock today based on this model will be,
P0 = D1 / r - g
Where,
D1 is the dividend expected for next year
r is the required rate of return
g is the growth rate in dividends
P0 = 5.2 / (0.14 - 0.072)
P0 = $76.47
