What is the stock expected dividend yield

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Reference no: EM131861522

1. A company's last dividend was $1.50 per share. The dividends are expected to grow at a constant rate of 5% per year. The price of this company’s common stock today is $28 per share. The company’s marginal tax rate is 35%. Based on the information above, the cost of equity is approximately ________.

2. A company just paid a dividend of $1.25, and those dividends are expected to grow at a constant rate of 5% forever. The stock price of this company is $60, what is the stock’s expected dividend yield?

Reference no: EM131861522

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