Assume JBH paid an annual dividend of $1.80 and has a share price of $50.00. It announced that the company expects its dividend to grow at 5% for indefinite future. Compute the cost of equity for this firm.
Cost of equity = [D0(1 + g) / P0] + g
Cost of equity = [$1.80(1.05) / $50.00] + 0.05
Cost of equity = 0.0878 or 8.78%
Assume JBH paid an annual dividend of $1.80 and has a share price of $50.00. It...
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