Required return-what is the price of the stock

Assignment Help Financial Management

Reference no: EM131048551

A7X Corp. just paid a dividend of $2.70 per share. The dividends are expected to grow at 19 percent for the next eight years and then level off to a growth rate of 7 percent indefinitely. If the required return is 14 percent, what is the price of the stock today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Stock price $

Reference no: EM131048551

Questions Cloud

Should a project manager ever censor bad news and risks : BUSM3327: Supply Chain Project Management Assessment. Should a project manager ever censor bad news and risks? Discuss- how did the BS project handle risks? What might they have done

Find the values for lump sum assuming annual compounding : Money has different values based on time. Money in your pocket has a current value, but money owed to you has a varying value based on how sure it is that you will receive it and when. Find the following values for a lump sum assuming annual compound..

Shares of common stock and two bond issues outstanding : Filer Manufacturing has 9.3 million shares of common stock outstanding. The current share price is $63, and the book value per share is $5. Filer Manufacturing also has two bond issues outstanding. The company’s stock has a beta of 1.3. The risk-free..

Financial system facilitated the great recession : What features of the U.S. financial system facilitated the Great Recession in 2007-2008? Could the crisis have been avoided? If so, how what institutional and systemic changes would have been required to prevent the problems that occurred? How well d..

Required return-what is the price of the stock : A7X Corp. just paid a dividend of $2.70 per share. The dividends are expected to grow at 19 percent for the next eight years and then level off to a growth rate of 7 percent indefinitely. If the required return is 14 percent, what is the price of the..

Most obvious economic reason for the persistent depreciation : Mexico tends to have much higher inflation than the United States, as well as much higher interest rates. Inflation and interest rates are much more volatile in Mexico than in industrialized countries. Identify the most obvious economic reason for th..

Pledges to increase its dividend : Caan Corporation will pay a $2.90 per share dividend next year. The company pledges to increase its dividend by 4 percent per year indefinitely. If you require a return of 11 percent on your investment, how much will you pay for the company’s stock t..

Leisure time planners : In 2009, LEISURE TIME PLANNERS, LLC rented a 10,000 SF office space from Martha Associates with the following terms: 5 year lease commencing on 1/1/2009, base rent of $4.00 PSF, and an expense stop of $2 PSF. In 2010, if utilities, property and other..

Estate sector with greatest risk-volatility of cash flows : Real estate users and real estate investors have the same goals, making it easy to complete lease transactions. The real estate sector with the greatest risk / volatility of cash flows because of the duration of lease contracts is:

User Account

All Pages