Valuation of a constant growth stock

Assignment Help Financial Management

Reference no: EM13726257

A stock is expected to pay a dividend of $3.00 the end of the year (that is, D1 = $3.00), and it should continue to grow at a constant rate of 4% a year. If its required return is 14%, what is the stock's expected price 1 year from today? Round your answer to two decimal places

Reference no: EM13726257

Questions Cloud

What is the maximum it would be reasonable : What is the maximum it would be reasonable ( i.e., do no financial harm) for the owner of a building to pay for a new heated drive way system if it would save $1,500 per year in ploughing charges. The owner's cost of money is 15%/yr. Assume the syste..

What main qualities are lost by not spending time at home : What important qualities and advantages are lost by not spending more time at home? How does Ure counter these fears? What concerns do all three authors address?

Regarding the appropriate tax rate to be used in the WACC : Which of the following is a true regarding the appropriate tax rate to be used in the WACC?

Calculating the weighted average cost of capital : When calculating the weighted average cost of capital, weights are based on

Valuation of a constant growth stock : A stock is expected to pay a dividend of $3.00 the end of the year (that is, D1 = $3.00), and it should continue to grow at a constant rate of 4% a year. If its required return is 14%, what is the stock's expected price 1 year from today? Round your ..

Why did the supreme court reject his argument : Identify two strategies for reducing excess credits - What would be the worldwide effective tax rate on the $1 million of foreign profits, assuming the U.S. taxes the worldwide income of domestic corporations, but allows an unlimited credit for for..

Complete marketing plan for apple watch : The company is apple, and the product is apple watch you need to do all the point in the three part to have complete marketing plan

Several strategic analyses of costco wholesale corporation : Several Strategic Analyses of Costco Wholesale Corporation. The purpose of this paper is to identify a competitive firm in a competitive industry, and proposition for a sustainable solutions paper. The sustainable solutions paper

Assignment related to online role-playing games : Construct evaluation techniques to the user experience and system usability in the design process. Describe the differences in developing user interfaces for different application environments.

User Account

All Pages