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Calculate company t cost of equity capital for company s

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Reference no: EM132976791

Ordinary shares in Company S are listed on the London Stock Exchange. Company T has announced a dividend of 32p per ordinary share for the current year. There will be only one dividend payable for the year.

  • It is forecast that Company T will announce a dividend of 34p per ordinary share for next year and that there will be only one dividend payable for the year.
  • Company T's shares have a market price of 198.85p

Problem 1: Calculate Company T's cost of equity capital based on the information above.

Reference no: EM132976791

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