Sunland Corp. is expected to pay a dividend of $2.65 next year. The forecast for the...
Sunland Corp. is expected to pay a dividend of $2.65 next year. The forecast for the stock price a year from now is $36.50. If the required rate of return is 16 percent, what is the current stock price? Assume constant growth. (Round answer to 2 decimal places, e.g. 15.20.)
Homework Answers
Current stock price=Future dividends and value*Present value of discounting factor(rate%,time period)
=2.65/1.16+36.5/1.16
which is equal to
=$33.75
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