Part Three:Determine the Value of Your Firmâs Equity:1. We will use the DividendDiscount Model to determine the firmâs equity â i.e., it willgive us the current price of a share of stock. We will use this model to estimate the valueof a share of your firmâs stock and compare this estimate to the current market value of this firmâs stock.2. Estimate the firmâs stock price using the DividendDiscount Model:a.Use an investment source â e.g. www.yahoofinance.com , www.morningstar.com tofind the following information:Current dividendii. Analysts estimated growth rate for the next 510 yearsb. Use your estimate of the cost of equity in the WACC for the rE part of your formulac. Combine the above information into the DividendDiscount Model3. Compare your result to the current market price of your firmâs stock. Describe, discuss,and analyze how they compare. Based on your knowledge of finance, how would youexplain any differences you observe?Notes:Whole Foods Market (WFM) is the firm to be used
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