You expect a share of stock to pay dividends of $1.5, $1.75, and $2 in each of the next 3 years. You believe the stock will sell for $15 at the end of the third year. What is the stock price if the discount rate for the stock is 10 percent?
Current price=Future dividend and value*Present value of discounting factor(rate%,time period)
=1.5/1.1+1.75/1.1^2+2/1.1^3+15/1.1^3
which is equal to
=$15.58(Approx).
You expect a share of stock to pay dividends of $1.5, $1.75, and $2 in each...
You expect a share of stock to pay dividends of $1.20, $1.35, and $1.70 in each of the next 3 years. You believe the stock will sell for $16.00 at the end of the third year. a. What is the stock price if the discount rate for the stock is 20%? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. What is the dividend yield for year 1? (Do not round intermediate calculations. Enter your answer...
" You expect Caterpillar will pay dividends of 1.75 in one year, 2.00 in two years, and 2.50 in three years. From that point onwards, dividends will grow at 4% per year. Investors' required rate of return is 10%. According to the Dividend Discount Model, what should be Caterpillar's stock price?"
Suppose you are thinking of purchasing the stock of Moore Oil, Inc. You expect the stock to pay a dividend of $0.75 per share at the end of Year 1 and $1.75 per share at the end of Year 2. You believe you can sell the stock for $15.50 at the end of Year 2. What is the value per share of the company’s stock if the required rate of return is 12 percent?
Suppose you are thinking of purchasing the stock of Moore Oil, Inc. You expect the stock to pay a dividend of $0.75 per share at the end of Year 1 and $1.75 per share at the end of Year 2. You believe you can sell the stock for $15.50 at the end of Year 2. What is the value per share of the company’s stock if the required rate of return is 12 percent? Please Show Work.
You are considering an investment in Keller Corp's stock, which is expected to pay a dividend of $1.75 a share at the end of the year (D1 = $1.75) has a beta of 0.9. The risk-free rate is 3.1%, and the market risk premium is 5.5%. Keller currently sells for $42.00 a share, and its dividend is expected to grow at some constant rate g. Assuming the market is in equilibrium, what does the market believe will be the stock...
Suppose you are thinking of purchasing the stock of Moore Oil, Inc. You expect the stock to pay a dividend of $0.75 per share at the end of Year 1 and $1.75 per share at the end of Year 2. You believe you can sell the stock for $15.50 at the end of Year 2. What is the value per share of the company’s stock if the required rate of return is 12 percent? $14.42 Please Show all Work Typed...
You buy a share of The Ludwig Corporation stock for $18.20. You expect it to pay dividends of $1.11, $1.1699, and $1.2331 in Years 1, 2, and 3, respectively, and you expect to sell it at a price of $21.31 at the end of 3 years. Calculate the expected dividend yield. Round your answer to two decimal places.
1. Suppose you are thinking of purchasing the stock of Moore Oil, Inc. You expect the stock to pay a dividend of $0.75 per share at the end of Year 1 and $1.75 per share at the end of Year 2. You believe you can sell the stock for $15.50 at the end of Year 2. What is the value per share of the company’s stock if the required rate of return is 12 percent? $14.42 Please Show All Work.
Company B is expected to pay dividends of $1.5 every 6 months for the next 3 years. If the current price of Company B stock is $22.6, and Company B's equity cost of capital is 10%. What price would you expect the stock to sell for at the end of 3 years?
Crisp Cookware's common stock is expected to pay a dividend of $1.75 a share at the end of this year (D1 = $1.75); its beta is 0.70; the risk-free rate is 3.5%; and the market risk premium is 4%. The dividend is expected to grow at some constant rate g, and the stock currently sells for $42 a share. Assuming the market is in equilibrium, what does the market believe will be the stock's price at the end of 3...