Calculating expected stock price

Reference no: EM1367008

Kirkland Motors expects to pay a $2 / share dividend on common stock at the end of the year. The stock currently sells for $20 per share. The required rate of return on corporation's stock is 12% [ks = .12]. The dividend is expected to grow at some constant rate over time. What is the expected stock price five years from now?
a. $21.65
b. $22.08
c. $25.64
d. $35.25
e. $36.78

Reference no: EM1367008

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