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Oxygen Optimization stock has an expected annual return of 10.18 percent. The stock is expected to...

Oxygen Optimization stock has an expected annual return of 10.18 percent. The stock is expected to be priced at 71.14 dollars per share in 1 year and the stock currently has an expected dividend yield of 6.82 percent. What is the current price of the stock?

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Answer #1

Expected return=dividend yield+Growth rate

Growth rate=10.18-6.82

=3.36%

Expected price=Current price*(1+Growth rate)

Hence current price=71.14/(1+0.0336)

=$68.83(Approx).

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