Dividend on common stock, Medtran is a profitable company

Dividend on common stock

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Reference no: EM1353643

Medtran is a profitable firm that is not paying a dividend on its common stock. James Weber, an analyst for A.G.Edwards, believes that Medtrans will begin paying a $1.00 per share dividend in two years and that the dividend will increase 6% annually thereafter. Bret Kimes, one of Jame's colleagues at the same firm, is less optimistic. Bret think that Medtrans will begin paying dividend in four years, that the dividend will be $1.00, and that it will grow at 4% annually. James and Bret agree that the required return for Medtrans is 13%.

Reference no: EM1353643

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