Assume that Bon Temps’ stock is currently selling at $21.20. What is the expected rate of return on the stock?
Background Info:
We see as calculated in the question itself, expected rate of return=total return=16.00%
Assume that Bon Temps’ stock is currently selling at $21.20. What is the expected rate of...
Bon Temps has an issue of preferred stock outstanding that pays stockholders a dividend equal to $10 each year. If the appropriate required rate of return for this stock is 8%, what is its market value?
2. Ricky Bobby Incorporated stock is selling for $16.48 this morning. Analysts believe the stock will sell for $19.57 in one year. The stock is expected to pay a $0.58 dividend per share. What return will you earn if you purchase now? 3. CPJ Industries has a share price today of $22.39. If CPJ is expected to pay a dividend of $0.69 per share this coming year, and the stock price is expected to grow to $22.76 by the end...
XYZ stock currently sells for $50 per share. The next expected annual dividend is $2, and the growth rate is 6%. What is the expected rate of return on this stock? If the required rate of return on this stock were 12%, what would the stock price be, and what would the dividend yield be?
show all work 7. A share of common stock has an expected long-run constant dividend growth rate of -5%, that is, the dividends are declining at 5% per year. The most recent dividend Do, was $5.00. The required rate of return on the common stock is 18%. Then, using the dividend growth model, calculate the current price of the stock. A share of common stock has an expected long-run constant dividend growth rate of 6%. and the most recent dividend...
The price of a stock today is $800. One year from today, the price is expected to be $840 and the stock is expected to pay a dividend of $16 per share. The risk-free rate is 0.06, the expected return on the market is 0.16, and the beta of the stock is 0.6. Calculate the stock's alpha. Express your answer with two digits after the decimal point (e.g., 0.12 or -0.12).
5. Suppose you know a company's stock currently sells for $20 per share and the required return on the stock is 0.13. You also know that the required return is evenly divided between the capital gains yield (G) and the dividend yield (D1/P0) (this means that if the required retun is 9%, the capital gains yield is 4.5% and the dividend yield is 4.5%).If it's the company's policy to always maintain a constant growth rate in its dividends, what is...
A stock is selling today for $60 per share. At the end of the year, it pays a dividend of $3 per share and sells for $63. a. What is the total rate of return on the stock? b. What are the dividend yield and percentage capital gain? c. Now suppose the year-end stock price after the dividend is paid is $54. What are the dividend yield and percentage capital gain in this case? (Negative amounts should be indicated by...
14. What is the expected price of a stock which pays a $1 dividend next year, has a required return of 5% and a dividend growth of 1%? What is the expected total return of the stock? What is the dividend yield of the stock? What is the capital gains return of the stock?
Krell Industries has a share price of $21.73 today. If Krell is expected to pay a dividend of $0.92 this year and its stock price is expected to grow to $24.66 at the end of the year, what is Krell's dividend yield and equity cost of capital? the dividend yield is ___% the capital gain rate is ___% the total return is ____%
Che The Duo Growth Company just paid a dividend of $1.00 per share. The dividend is expected to grow at a rate of 26% per year for the next three years and then to level off to 5% per year forever. You think the appropriate market capitalization rate is 21% per year. a. What is your estimate of the intrinsic value of a share of the stock? (Use intermediate calculations rounded to 4 decimal places. Round your answer to 2...