Year 2014 2015 2016 2017 2018 Dividend $0.8 $0.9 $1.00 $1.3 $1.4 $ Change ? ?...
Year 2014 2015 2016 2017 2018
Dividend $0.8 $0.9 $1.00 $1.3 $1.4
$ Change ? ? ? ?
% Change ? ? ? ?
Given the dividend information above, if the dividend just paid is $1.4 in 2018 and the price per share of this company’s stock is $64, what is the cost of equity using the dividend growth model?
Homework Answers
Change % = (1.4/0.8)1/4 -1 = 15.02%
Calculating Cost of Equity,
Cost of Equity = 1.4(1.1502)/(64) + 0.1502
Cost of Equity = 17.54%
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Year 2014 2015 2016 2017 2018
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$ Change ? ?...
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