Harrison Clothiers' stock currently sells for $39 a share. It just paid a dividend of $2.25 a share (that is, D0 = 2.25). The dividend is expected to grow at a constant rate of 5% a year.
a. What stock price is expected 1 year from now? Round your answer to two decimal places. $
b. What is the required rate of return? Round your answers to two decimal places. %
Ezzell Corporation issued perpetual preferred stock with a 9% annual dividend. The stock currently yields 9%, and its par value is $100.
a. What is the stock's value? Round your answer to two decimal places. $
b. Suppose interest rates rise and pull the preferred stock's yield up to 12%. What would be its new market value? Round your answer to two decimal places. $
1. Price at year 0 (P0) =39
Growth =5%
a. Stock price one year from now =P0*(1+growth) =39*(1+5%)
=40.95
b. Required Rate =Dividend in year 1/Price +growth
=2.25*(1+5%)/39+5% =11.06%
2. a. Stock Value =Annual Dividend/Current yield
=9%*100/9%=100
b. New Market Value =Annual Dividend/Current yield
=9%*100/12%=75
Harrison Clothiers' stock currently sells for $39 a share. It just paid a dividend of $2.25...
Harrison Clothiers' stock currently sells for $18 a share. It just paid a dividend of $4 a share (that is, D0 = 4). The dividend is expected to grow at a constant rate of 9% a year. What stock price is expected 1 year from now? Round your answer to two decimal places. $ What is the required rate of return? Round your answers to two decimal places.
Holtzman Clothiers' stock currently sells for $15 a share. It just paid a dividend of $2.5 a share (i.e., D0 = $2.5). The dividend is expected to grow at a constant rate of 4% a year. What stock price is expected 1 year from now? Round your answer to two decimal places. $ What is the required rate of return? Round your answers to two decimal places. Do not round your intermediate calculations. %
Holtzman Clothiers's stock currently sells for $28.00 a share. It just paid a dividend of $2.25 a share (i.e., D0 = $2.25). The dividend is expected to grow at a constant rate of 10% a year. . What stock price is expected 1 year from now? Round your answer to two decimal places. What is the required rate of return? Do not round intermediate calculations. Round your answer to two decimal places.
Problem 9-3 Constant growth valuation Harrison Clothiers' stock currently sells for $34 a share. It just paid a dividend of $2.5 a share (that is, Do = 2.5). The dividend is expected to grow at a constant rate of 7% a year. a. What stock price is expected 1 year from now? Round your answer to two decimal places. b. What is the required rate of return? Round your answers to two decimal places.
Holtzman Clothiers's stock currently sells for $31.00 a share. It just paid a dividend of $2.25 a share (i.e., D0 = $2.25). The dividend is expected to grow at a constant rate of 10% a year. What stock price is expected 1 year from now? Round your answer to the nearest cent. What is the required rate of return? Do not round intermediate calculations. Round your answer to two decimal places.
10. Harrison Clothiers' stock currently sells for $20.00 a share. It just paid a dividend of $1.00 a share (that is, Do = $1.00). The dividend is expected to grow at a constant rate of 6% a year. What stock price is expected 1 year from now? What is the required rate of return?
Constant growth valuation Holtzman Clothiers' stock currently sells for $37 a share. It just paid a dividend of $3.75 a share (i.e., D0 = $3.75). The dividend is expected to grow at a constant rate of 6% a year. What stock price is expected 1 year from now? Round your answer to two decimal places. $ What is the required rate of return? Round your answers to two decimal places. Do not round your intermediate calculations. %
9. Harrison Clothiers' stock currently sells for $20 ashare. It just paid a dividend of $1.00 a share (that isD0 = $1.00). The dividend is expected to grow at aconstant rate of 6 percent a year. What stock price isexpected 1 year from now? What is the required rate ofreturn? 10. A stock is expected to pay a dividend of $0.50 at the end of theyear (that is, D1 = 0.50), and it should continue togrow at a constant rate...
3. Holtzman Clothiers's stock currently sells for $40 a share. It just paid a dividend of $2.25 a share (i.e., D0 = $2.25). The dividend is expected to grow at a constant rate of 5% a year. What stock price is expected 1 year from now? Round your answer to two decimal places. $ What is the required rate of return? Round your answer to two decimal places. Do not round your intermediate calculations. %
Problem 9-8 Preferred stock valuation Ezzell Corporation issued perpetual preferred stock with a 8% annual dividend. The stock currently yields 6%, and its par value is $100. a. What is the stock's value? Round your answer to two decimal places. b. Suppose interest rates rise and pull the preferred stock's yield up to 14%. What would be its new market value? Round your answer to two decimal places.