A company has just paid out a per-share dividend of $5.15 on its common stock. Analysts...

A company has just paid out a per-share dividend of $5.15 on its common stock. Analysts expect that these per-shares dividends will grow at a rapid rate of 16% over the coming 6 years, after which the rate of growth in per-share dividends will decline to 4.5%. It is estimated that investors requite a return of 13% on this stock. Each share of this stock should be selling for

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Company XYZ common stock just paid a dividend of $2.00 per share and its dividend is...

Company XYZ common stock just paid a dividend of $2.00 per share and its dividend is expected to grow at 10 percent per year for three years and then grow at 4 percent per year forever. XYZ stocks have a 13 percent required return. You should you be willing to pay?

Saunders Corp. has paid out a per-share dividend of $4 on its common stock for the...

Saunders Corp. has paid out a per-share dividend of $4 on its common stock for the year just ended. Analysts expect that the company’s earnings and dividends per share will grow at a rate of 12% for the coming 5 years, and then begin to grow at a constant rate of 3.5% for the foreseeable future after that. The company’s stock has a beta of 1.50. The proxy for the risk-free rate stands at 2.5%, and the market risk premium...

The In-Tech Co. just paid a dividend of $1 per share. Analysts expect its dividend to...

The In-Tech Co. just paid a dividend of $1 per share. Analysts expect its dividend to grow at 25% per year for the next three years and then at a constant growth rate per year thereafter. The estimate of the constant growth rate of dividend is based on the long term return of equity 25% and payout ratio 80%. If the required rate of return on the stock is 18%, what is the current value of the stock? Clearly show...

The In-Tech Co. just paid a dividend of $1.5 per share. Analysts expect its dividend to...

The In-Tech Co. just paid a dividend of $1.5 per share. Analysts expect its dividend to grow at 20 percent per year for the next three years and then 3 percent per year thereafter. If the required rate of return on the stock is 5.5 percent. What is the current value of the stock ? 96.80 94.15 none of the above 98.30 92.16

Omicron Company has just paid a dividend of $2 per share. Analysts of the company’s shares...

Omicron Company has just paid a dividend of $2 per share. Analysts of the company’s shares estimate a supernormal growth rate of 30% for the company for the next two years. Afterwards, the company is expected grow at a rate of 15% for another three years, before settling down to a stable growth rate of 7.5% forever. What is Omicron’s share price in two years’ time (after the second year of supernormal growth), assuming a required return of 12%?

Ford Motor Company just paid a dividend of $1.80 per share and its stock has a...

Ford Motor Company just paid a dividend of $1.80 per share and its stock has a beta of 1.2. Risk free rate is 4% and expected return of the stock market is 12%. Ford wants to change its dividend policy to one of the two alternatives, what will be today’s stock price under each situation? Keep plowback ratio at 100% for the next 5 years. At the end of the sixth year, Ford will pay a $3 per share dividend...

XYZ Corp. just paid an annual dividend of $3 per share on its common stock. This...

XYZ Corp. just paid an annual dividend of $3 per share on its common stock. This dividend is expected to grow at a 10% annual rate for two years, after which it is expected to grow at a 6% annual rate forever. If the required return is 10%, what value would you place on this stock?

Digital Plc just paid a dividend of $3 per share. Analysts expect its dividend to grow...

Digital Plc just paid a dividend of $3 per share. Analysts expect its dividend to grow at 12% per year for the next three years and then 6% per year, indefinitely thereafter. If the required rate of return on the stock is 10%, what is the current value of the stock? a) 93 b) 87 c) 77 d) 69 e) 98

A company just paid a dividend of $1.50 per share. The consensus forecast of financial analysts...

A company just paid a dividend of $1.50 per share. The consensus forecast of financial analysts is a dividend of $1.70 per share next year, $2.40 per share two years from now, and $2.70 per share in three years. You expect the price of the stock to be $28 in two years. If the required rate of return is 10% per year, what would be a fair price for this stock today? (Answer to the nearest penny.)

The Birdstrom Co. just recently paid a dividend of $2.00 per share. Stock market analysts expect...

The Birdstrom Co. just recently paid a dividend of $2.00 per share. Stock market analysts expect that the growth rate for the dividend will be 40% in year 1, 30% in year 2, 20% in year 3, 15% in year 4, and 10% in year five. After the fifth year, the dividend will grow at a constant rate of 6%. If the required return for Birdstrom is 12%, calculate the current stock price and the expected dividend yield and capital...

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