Growth Rate = (Dividend, 2019 / Dividend, 2015)^(1/4) - 1
Growth Rate = ($2.53 / $1.47)^(1/4) - 1
Growth Rate = 1.721088^(1/4) - 1
Growth Rate = 1.14538 - 1
Growth Rate = 0.14538 or 14.538%
Dividend, 2020 = Dividend, 2019 * (1 + Growth Rate)
Dividend, 2020 = $2.53 * 1.14538
Dividend, 2020 = $2.8978
Value of Stock = Dividend, 2020 / (Required Return - Growth
Rate)
Value of Stock = $2.8978 / (0.2200 - 0.14538)
Value of Stock = $2.8978 / 0.07462
Value of Stock = $38.83
The value of Seagate’s stock is $38.83
Seagare Technology is a global leader in data storage solutions and a high yield dividend payer....
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