Winston Inc. has just paid a dividend of $4.10. An analyst forecasts annual dividend growth of...

Winston Inc. has just paid a dividend of $4.10. An analyst forecasts annual dividend growth of 9 percent for the next five years; then dividends will decrease by 1 percent per year in perpetuity. The required return is 12 percent (effective annual return, EAR). What is the current value per share according to the analyst? (Round present value factor calculations to 5 decimal places, e.g. 1.54667 and other intermediate calculations to 3 decimal places, e.g.15.612. Round final answer to 2 decimal places, e.g.15.61.)

Expert Solution

jeff jeffy answered 2 years ago

Windsor Inc. has just paid a dividend of $4.10. An analyst forecasts annual dividend growth of...

Windsor Inc. has just paid a dividend of $4.10. An analyst forecasts annual dividend growth of 9 percent for the next five years; then dividends will decrease by 1 percent per year in perpetuity. The required return is 12 percent (effective annual return, EAR). What is the current value per share according to the analyst? (Round present value factor calculations to 5 decimal places, e.g. 1.54667 and other intermediate calculations to 3 decimal places, e.g.15.612. Round final answer to 2...

Monster Inc just paid a dividend of $1.33. Its stock has a dividend growth rate of...

Monster Inc just paid a dividend of $1.33. Its stock has a dividend growth rate of 7.6% and a required return of 12.21%. What is the current stock price if we anticipate dividends stopping in 10 years?

JAM Co just paid a dividend of $5.00, and expects an annual dividend growth rate of...

JAM Co just paid a dividend of $5.00, and expects an annual dividend growth rate of 5% indefinitely. What is the expected dividend a year from now? XYZ Co just paid a dividend of $3.00, and expects an annual dividend growth rate of 5% indefinitely. What is the expected dividend a year from now? PDQ Co just paid a dividend of $2.00, and expects an annual dividend growth rate of 6% indefinitely. What is the expected dividend a year from now? RAM Co...

Cavalier Custom Design Inc. just paid a dividend of $0.73. Its stock has a dividend growth...

Cavalier Custom Design Inc. just paid a dividend of $0.73. Its stock has a dividend growth rate of 5.62% and a required return of10.21%. What is the current stock price if we anticipate dividends stopping in 20 years? Please show the work, excel preferred.

Consider a firm that has just paid a dividend of $2. An analyst expects dividends to...

Consider a firm that has just paid a dividend of $2. An analyst expects dividends to grow at a rate of 8% per year for the next five years. After that dividends are expected to grow at a normal rate of 5% per year. Assume that the appropriate discount rate is 7%. i. Calculate the dividends for years 1, 2, and 3. ii. What is the price of the stock in year 5? iii. Calculate the present value today of...

Consider a firm that has just paid a dividend of $3. An analyst expects dividends to...

Consider a firm that has just paid a dividend of $3. An analyst expects dividends to grow at a rate of 8 percent per year for the next five years. After that, dividends are expected to grow at a normal rate of 1 percent per year. Assume that the appropriate discount rate is 7 percent. What is the price of the stock today?

A stock just paid a dividend of $1, and is estimated to have a dividend growth...

A stock just paid a dividend of $1, and is estimated to have a dividend growth rate of 25% and 10% in the next two years. The stock is estimated to settle down to a 4% constant dividend growth thereafter. The required return of investors is 12%. (Round your answer to two digits after the decimal point.) show your work What is the dividend of year 1? What is the dividend of year 2? What is the dividend of year...

Universal Laser, Inc., just paid a dividend of $3.10 on its stock. The growth rate in...

Universal Laser, Inc., just paid a dividend of $3.10 on its stock. The growth rate in dividends is expected to be a constant 6 percent per year, indefinitely. Investors require a 15 percent return on the stock for the first three years, a 13 percent return for the next three years, and then an 11 percent return thereafter. What is the current share price for the stock?

Dumbo Inc. just paid a dividend of $2.70. The company expects a super growth of 6%...

Dumbo Inc. just paid a dividend of $2.70. The company expects a super growth of 6% for the first 4 years and expect to grow at a constant rate of 3% after that. IF the current Ke is 6.5%, what is the expected price of this stock today? Answer choices are: 100.31 104.52 67.59 88.65 92.69

Springs Inc. just paid a dividend of $2.50 on its stock. The growth rate in dividends...

Springs Inc. just paid a dividend of $2.50 on its stock. The growth rate in dividends is expected to be a constant 5 percent per year, indefinitely. Investors require a 13 percent return on the stock for the first three years, 11 percent return for the next five years, and then a 9 percent return thereafter. a. What is the price of the stock at the end of Year 8? b. What is the price of the stock at the...

Question