What is the common stock price today

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NASCAR is a blue-chip company listed on NASDAQ and since it has businesses in more than 60 countries, it is expected that it can distribute stable dividends with a growth rate of 2% every year and the market expects it can generate 5% return on the common stock.

The dividends of the common stock just distributed were $3 per share.

a) What is the common stock price today?

b) What is the theoretical common stock price 3 years later?

c) NASCAR also issued preferred shares (constant dividends paid every year forever) with a stated value of $70 each with 5% dividends 5 years ago. The next dividend will be paid today and you will receive the next dividend. The required return on the preferred stock is 3%. What is the price of the preferred stock today?

Reference no: EM132392831

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