Ans c. 10.5%
P0 = | Price of Share |
D1 = | Current Dividend |
Ke = | Cost of Equity |
g = | growth rate |
P0 = | D1 / (Ke - g) |
181.34 = | 10.16 / (Ke - 4.9%) |
Ke - 4.9% = | 10.16 / 181.34 |
Ke - 4.9% = | 5.60% |
Ke = | 5.60% + 4.90% |
Ke = | 10.5% |
A large international financial institution is expected to pay a $10.16 dividend in one year. The...
A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is rs=10.5%, and the expected constant growth rate is g=10%. What is the stock's current price?
A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is rs = 10.5%, and the expected constant growth rate is g = 1%. What is the stock's current price?
A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is rs = 10.5%, and the expected constant growth rate is g = 6.4%. What is the stock's current price?
A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is rs = 10.5%, and the expected constant growth rate is g = 3.5%. What is the stock's current price? Select the correct answer. a. $13.61 b. $10.71 c. $15.06 d. $12.16 e. $16.51
Non- constant growth A stock is expected to pay a dividend of $8 next year and this will increase by $2 for each of the following 3 years. after that, the company is expected to pay no dividends to its shareholders. if the required rate of return is 11% on this stock, what is the current stock price?
18. A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is rs = 10.5%, and the expected constant growth rate is g = 8.2%. What is the stock's current price? e.$27.07 O d.$38.80 O c.$32.61 O b. $29.02 O a$27.39
A share is expected to pay a dividend of $1.40 in one year. This dividend is expected to increase at an annual rate of 5% forever. If the required return is 15%, what is the fair value of this share today?
A stock is expected to pay a dividend of $1 at the end of the year. The required rate of return is r s = 10%, and the expected constant growth rate is 5%. What is the current stock price?
Suppose Disney Inc. is expected to pay a $5 dividend in one year. If the dividend is expected to grow at 8% per year and the required return is 12%, what is the price? Versace Company is expected to pay a dividend of $5 next period and dividends are expected to grow at 6% per year. The required return is 15%. What is the current price? Babe Clothing Company is expected to pay a dividend of $5 next period and dividends...
Zombie Manufacturing Company is expected to pay a dividend of $3.44 in the upcoming year. Dividends are expected to grow at 5.9% per year. The risk-free rate of return is 2%, and the expected return on the market portfolio is 9.2%. Investors use the CAPM to compute the market capitalization rate and use the constant-growth dividend discount model to determine the value of the stock. The stock's current price is $99. What is your estimate for the market capitalization rate...