What is value of stock based on expected future dividend

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1. A stock is expected to pay $2.40 in dividends next year. The dividends are expected to grow at 3% per year subsequently in perpetuity. The opportunity cost of capital for the stock is 15% per year compounded quarterly. What is the value of this stock based on expected future dividend?

2. Quantitative Problem: After a 4-for-1 stock split, Perry Enterprises paid a dividend of $1.70 per new share, which represents a 7% increase over last year's pre-split dividend. What was last year's dividend per share? Round your answer to the nearest cent. $_____

Reference no: EM132048307

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