WIN Corp just paid a dividend (today) of $2.00 per share on its stock.

WIN Corp just paid a dividend (today) of $2.00 per share on its stock. The dividends are expected to grow at a constant 16% per year indefinitely. If investors require a 23% return on CO stock, what is the current price?

a. $28.57

b. $33.14

c. $35.14

d. $12.50

e. $29.00

Solutions

Expert Solution

jeff jeffy answered 2 years ago

Next > < Previous

Related Solutions

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?

Mariota Corp. just paid a dividend of $4.35 per share on its stock.

2. MC algo 8-40 Nonconstant DividendsMariota Corp. just paid a dividend of $4.35 per share on its stock. The dividend growth rate is expected to be 3.15 forever and investors require a return of 13.7 percent on this stock. What will the stock price be in 7 years?Multiple Choice$46.48$51.23$21.51$52.84$40.695. MC algo 8-29 Valuing StockBraxton's Cleaning Company stock is selling for $31.75 per share based on a required return of 9.9 percent. What is the the next annual dividend if the...

The Jackson–Timberlake Wardrobe Co. just paid a dividend of $2.00 per share on its stock. The...

The Jackson–Timberlake Wardrobe Co. just paid a dividend of $2.00 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely. Investors require a return of 12 percent on the company's stock. A. What is the current stock price? B. What will the stock price be in three years? C. What will the stock price be in 12 years?

The Jackson–Timberlake Wardrobe Co. just paid a dividend of $2.00 per share on its stock. The...

The Jackson–Timberlake Wardrobe Co. just paid a dividend of $2.00 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely. Investors require a return of 12 percent on the company's stock. What is the current stock price? What will the stock price be in three years? What will the stock price be in 12 years?

Yoland Co. just paid a dividend of $2.00 per share. The company will increase its dividend...

Yoland Co. just paid a dividend of $2.00 per share. The company will increase its dividend by 20 percent next year and then reduce its dividend growth rate by 5 percentage points per year until it reaches the industry average of 5 percent dividend growth, after which the company will keep a constant growth rate forever. If the stock price is $53.04, what required return must investors be demanding on the company's stock? (Hint: Set up the valuation formula with...

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?

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...

(8 marks) Alberto Inc. just paid its annual dividend of $2.00 per share. The firm is...

Alberto Inc. just paid its annual dividend of $2.00 per share. The firm is expected to grow at a rate of 10 percent for the next two years and then at 6 percent per year thereafter. The required return of Alberto Inc. is 12%. Find the expected price of the stock in one year, P1. The table below is the YTM of U.S. Treasuries with different maturities on April 1, 2020. 1 yr. 2 yr. 3 yr. 5 yr. 7...

BLUECHIP PLC just paid a dividend of $2.00 per share. The managing director just announced that...

BLUECHIP PLC just paid a dividend of $2.00 per share. The managing director just announced that it is planned to increase dividends at a rate of 6% indefinitely. An appropriate discount rate for this company is 16% per annum. What is the firm’s expected dividend stream over the next 3 years? What is the firm’s current stock price? What is the firm’s expected value in one year? d.What is the expected dividend yield, capital gains yield and total return...

Holtzman Clothiers's stock currently sells for $27.00 a share. It just paid a dividend of $2.00...

Holtzman Clothiers's stock currently sells for $27.00 a share. It just paid a dividend of $2.00 a share (i.e., D0 = $2.00). The dividend is expected to grow at a constant rate of 8% a year. What stock price is expected 1 year from now? Round your answer to the nearest cent. $ What is the required rate of return? Do not round intermediate calculations. Round your answer to two decimal places. %

Subjects