Question

In: Finance

ABC, Company is expected to pay a dividends of $2.18 on their common stock. The company...

ABC, Company is expected to pay a dividends of $2.18 on their common stock. The company expects the growth rate to be 3.2% infinitely. If today's price of the stock is $72.57, what is the dividend yield?

Solutions

Expert Solution

The dividend yield is computed as follows:

= Expected dividend / current price of stock

= $ 2.18 / $ 72.57

= 3% Approximately

jeff jeffy answered 3 years ago
Next > < Previous

Related Solutions

A common stock is expected to pay no dividends during the next 7 quarters but at...
A common stock is expected to pay no dividends during the next 7 quarters but at the end of 6th quarter, it is expected to pay DPS of $1.0 and thereafter dividends are expected to be paid quarterly and into indefinite future. The quarterly growth rate of dividends stream is 1.0% and it is expected to stay the same into indefinite future. The required expected rate of return on the common stock is 12% per annum. Find: (i)The current price...
Sanford common stock is expected to pay $1.50 in dividends next​ year, and the market price...
Sanford common stock is expected to pay $1.50 in dividends next​ year, and the market price is projected to be $52.35 per share by​year-end. If investors require a rate of return of 13 percent, what is the current value of the​ stock?
A company’s common stock is expected to pay $2 in dividends annually over the next four...
A company’s common stock is expected to pay $2 in dividends annually over the next four years. At the end of the fourth year, its stock is expected to be valued at $45. If the firms cost of equity is 12%, what is its intrinsic value? What should its stock sell for in 1 year? Please use excel and show work.
ABC common stock is expected to have have dividends in year 1 of $3/share,  year 2 of...
ABC common stock is expected to have have dividends in year 1 of $3/share,  year 2 of $3/share,year 3 of $3.2/share, year 4 of $3.4/share, and in year 5 of $3.6/share. Then dividends will grow at a constant rate of 6%. If the discount rate is 15% , what should be the current share price? Hint: The growing perpetuity (Gordon growth model) should be put into year 5 along with the year 5 dividend before taking the present values. $31.16 $31.80...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then the expected dividend is $0.60 per share, which will continue to grow at a constant rate of 25% per annum for another 3 years. After that, the dividend will grow indefinitely at 4% per annum. If the rate of return is 11% per annum, what is the current value of a share in ABC Ltd? b) If the discount rate is 8%, what is...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then the expected dividend is $0.70 per share, which will continue to grow at a constant rate of 25% per annum for another 3 years. After that, the dividend will grow indefinitely at 4% per annum. If the rate of return is 10% per annum, what is the current value of a share in ABC Ltd? b) If the discount rate is 8%, what is...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then the expected dividend is $0.70 per share, which will continue to grow at a constant rate of 25% per annum for another 3 years. After that, the dividend will grow indefinitely at 4% per annum. If the rate of return is 10% per annum, what is the current value of a share in ABC Ltd? b) If the discount rate is 8%, what is...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then...
a) ABC Ltd is not expected to pay any dividends for the next 3 years. Then the expected dividend is $0.70 per share, which will continue to grow at a constant rate of 25% per annum for another 3 years. After that, the dividend will grow indefinitely at 4% per annum. If the rate of return is 10% per annum, what is the current value of a share in ABC Ltd? b) If the discount rate is 8%, what is...
ABC Ltd is not expected to pay any dividends for the next 3 years. Then the...
ABC Ltd is not expected to pay any dividends for the next 3 years. Then the expected dividend is $0.70 per share, which will continue to grow at a constant rate of 25% per annum for another 3 years. After that, the dividend will grow indefinitely at 4% per annum. a) If the rate of return is 10% per annum, what is the current value of a share in ABC Ltd? b) If the discount rate is 8%, what is...
ABC stock is expected to pay a dividend of $3.85 in 1 year. The stock is...
ABC stock is expected to pay a dividend of $3.85 in 1 year. The stock is currently priced at $64.80, is expected to be priced at $69.29 in 1 year, and is expected to be priced at $72.78 in 2 years. What is the dividend in 2 years expected to be for ABC stock? The stock’s dividend is paid annually and the next dividend is expected in 1 year.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT