Suppose Potter Ltd. just issued a dividend of $2.50 per share on its common stock. The...

Suppose Potter Ltd. just issued a dividend of $2.50 per share on its common stock. The company paid dividends of $2.00, $2.07, $2.24, and $2.34 per share in the last four years. If the stock currently sells for $69, what is your best estimate of the company’s cost of equity capital using arithmetic and geometric growth rates?

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jeff jeffy answered 9 months ago

Suppose Potter Ltd. just issued a dividend of $2.51 per share on its common stock. The...

Suppose Potter Ltd. just issued a dividend of $2.51 per share on its common stock. The company paid dividends of $2.01, $2.08, $2.25, and $2.35 per share in the last four years. What was the dividend growth rate for each year? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) What were the arithmetic average and geometric average dividend growth rates over the past four years? (Do not round intermediate...

Suppose Potter Ltd. just issued a dividend of $1.82 per share on its common stock. The...

Suppose Potter Ltd. just issued a dividend of $1.82 per share on its common stock. The company paid dividends of $1.36, $1.46, $1.53, and $1.68 per share in the last four years, respectively. If the stock currently sells for $55, what is your best estimate of the company’s cost of equity capital using arithmetic and geometric growth rates? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

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Suppose Hornsby Ltd. just issued a dividend of $2.55 per share on its common stock. The company paid dividends of $2.05, $2.12, $2.29, and $2.39 per share in the last four years. What was the dividend growth rate for each year? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Growth rate Year 1 % Year 2 % Year 3 % Year 4 % What were the arithmetic and geometric...

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part A The Drogon Co. just issued a dividend of $2.51 per share on its common...

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