What is the expected growth rate of the dividends

Assignment Help Financial Management

Reference no: EM131087928

The common stock of Polybius Inc. just paid an annual dividend of $ 0.83 . The dividend is expected to grow at a constant rate forever. The required rate of return for this stock is 12.5 percent. If the current price of the stock is $ 24.85 what is the expected growth rate of the dividends?

Reference no: EM131087928

Questions Cloud

What is the length of the days sales in inventory : Dabble, Inc., has sales of $989,000 and cost of goods sold of $545,000. The firm had a beginning inventory of $40,500 and an ending inventory of $50,500. What is the length of the days’ sales in inventory?

What are arithmetic and geometric returns for stock : A stock has had returns of −18.5 percent, 28.5 percent, 18.0 percent, −9.6 percent, 34.3 percent, and 26.5 percent over the last six years. Required: What are the arithmetic and geometric returns for the stock?

The equipment necessary for production of the potato pet : Pappy’s Potato has come up with a new product, the Potato Pet (they are freeze-dried to last longer). Pappy’s paid $132,000 for a marketing survey to determine the viability of the product. The equipment necessary for production of the Potato Pet wil..

Find the npv of entering this mba program : Jenny Jenks has researched the financial pros and cons of entering into a 1-year mba program at her state university. the tuition and books for the master's program will have an up-front cost of 100,000. given her estimates, find the npv of entering ..

What is the expected growth rate of the dividends : The common stock of Polybius Inc. just paid an annual dividend of $ 0.83 . The dividend is expected to grow at a constant rate forever. The required rate of return for this stock is 12.5 percent. If the current price of the stock is $ 24.85 what is t..

Calculate the annual cash flows : Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 25-year annuity is $1.9 million and the annuity earns a guaranteed annual return of 11 percent. The payments are to begin at the end of seven ..

What is expected return on the portfolio : You own a portfolio that has $3,800 invested in Stock A and $4,800 invested in Stock B. If the expected returns on these stocks are 8 percent and 11 percent, respectively, what is the expected return on the portfolio?

What is expected return on the portfolio : You own a portfolio that has $2,000 invested in Stock A and $3,100 invested in Stock B. Assume the expected returns on these stocks are 10 percent and 16 percent, respectively. Required: What is the expected return on the portfolio?

About the option portfolio : Consider the following option portfolio. You write a July 2007 expiration call option on IBM with exercise price $90. You also write a July expiration IBM put option with exercise price $85. What will be the profit/loss on this position if IBM is sel..

User Account

All Pages