High Fashion Co. has the following data:
• Beta is 1.5,
• market risk premium is 5.5%,
• and government bond rate is 3%.
• The company's last dividend was $2.00.
• Future earnings and dividends are expected to grow at a rate of 10% in year 1, 15% in year 2, 20% in year 3, and 25% for years 4 and 5, respectively, and then competition is expected to reduced future growth rate to 5% thereafter.
What is fair market value of the common stock? Show your work.