(10 pts) Doolittle Co. is expected to pay a dividend of $2.3 next year. Doolittle is expected to pay 20% of its earnings as dividends and will have...

19. (10 pts) Doolittle Co. is expected to pay a dividend of $2.3 next year. Doolittle is expected to pay 20% of its earnings as dividends and will have an ROE of 9% until the fourth year. After that, its ROE is expected to decrease to 2.7% and the dividend payout ratio will increase to 30%. Applying the cost of equity of 11.6% and the supernormal growth model, compute the intrinsic price of Doolittle.