Question
In: Finance
Your company is estimated to make dividends payments of $2 next year, $3.6 the year after,...
Your company is estimated to make dividends payments of $2 next year, $3.6 the year after, and $4.6 in the year after that. The dividends will then grow at a constant rate of 7% per year. If the discount rate is 11% then what is the current stock price?
Solutions
jeff jeffy answered 2 years agoRelated Solutions
Your company is estimated to make dividends payments of $2.9 next year, $3.5 the year after,...
Your company is estimated to make dividends payments of $2.9
next year, $3.5 the year after, and $4.4 in the year after that.
The dividends will then grow at a constant rate of 5% per year. If
the discount rate is 9% then what is the current stock price?
A company currently pays a dividend of $3.6 per share (D0 = $3.6). It is estimated that the company's dividend will grow at a rate of 25% per year for the next 2 years
A company currently pays a dividend of $3.6 per share (D0 = $3.6). It is estimated that the company's dividend will grow at a rate of 25% per year for the next 2 years, and then at a constant rate of 8% thereafter. The company's stock has a beta of 1.1, the risk-free rate is 9.5%, and the market risk premium is 4.5%. What is your estimate of the stock's current price? Do not round intermediate calculations. Round your answer...
A stocks next 2 dividends are as follows: $0.25 and $1.00. After that, the stock is...
A stocks next 2 dividends are as follows: $0.25 and $1.00. After
that, the stock is expected to grow at a rate of 4% indefinitely.
The required return on this stock is 16%. Compute its fair market
value.
Lohn Corporation is expected to pay the following dividends over the next four years: $7.48, $3.6,...
Lohn Corporation is expected to pay the following dividends over
the next four years: $7.48, $3.6, $6.1, and $6.07. Afterward, the
company pledges to maintain a constant 4.95 percent growth rate in
dividends forever. If the required return on the stock is 7.06
percent, what is the current share price?
The expected dividends for a stock are: Year 1=$2, Year 2=$3, after Year 2, we expect...
The expected dividends for a stock are: Year 1=$2, Year 2=$3,
after Year 2, we expect dividends to grow by 6% forever. If we
require an annual return of 8% from this stock, what would be the
value of the stock to us? If it sells for $30 in the market, should
we buy it?
Suppose a firm will pay a $2 dividend next year and expects to increase dividends by...
Suppose a firm will pay a $2 dividend next year and expects to
increase dividends by 20%, 15%, and 10% over the following three
years. After that, dividends will increase at a rate of 5% per year
indefinitely. If the required return is 17%, what is the price of
the stock today?
Group of answer choices
$19.21
$21.50
$18.80
$22.14
$20.98
Suppose a firm will pay a $2 dividend next year and expects to increase dividends by...
Suppose a firm will pay a $2 dividend next year and expects to
increase dividends by 20%, 15%, and 10% over the following three
years. After that, dividends will increase at a rate of 5% per year
indefinitely. If the required return is 17%, what is the price of
the stock today?
Group of answer choices
$22.14
$18.80
$19.21
$21.50
$20.98
A corporate pension plan has to make the following payments over the next few years: Year...
A corporate pension plan has to make the following payments over
the next few years:
Year
1
2
3
4
Amount ($ million)
16
20
26
34
The appropriate interest rate is 6%.
1. What is the present value of the liability (in $
million)?
2. What is the duration of the liability?
A company currently pay a dividend $3.6 per share. It is estimated that the company's dividend...
A
company currently pay a dividend $3.6 per share. It is estimated
that the company's dividend will grow at a rate of 24% per year for
the next two years and then at a constant rate of 8% thereafter.
The company stock has a beta of 1.4, then the risk free rate is 9%,
and the market risk premium is 5.5%. What is your estimate of the
stock's current price
You plan to make contributions to your retirement account for the next 20 years. After the...
You plan to make contributions to your retirement
account for the next 20 years. After the last contribution, you
will retire and begin withdrawing $3000 each month, and you want
the money to last an additional 20 years. Assume your account earns
8% interest compounded monthly.
a.How much do you need to have saved in 20
years in order to withdraw according to plan?
b) How much do you need to deposit into the savings account for
the next 20...
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