What is your estimate of the stock current price

Assignment Help Finance Basics

Reference no: EM131958048

Question: A company currently pays a dividend of $1.75 per share (D0 = $1.75). It is estimated that the company's dividend will grow at a rate of 19% per year for the next 2 years, and then at a constant rate of 6% thereafter. The company's stock has a beta of 0.85, the risk-free rate is 4.5%, and the market risk premium is 6%. What is your estimate of the stock's current price? Do not round intermediate calculations. Round your answer to the nearest cent.

Reference no: EM131958048

Questions Cloud

Calculate the price of share of the company common stock : Calculate the price of a share of the company's common stock.

Common equity on firm balance sheet : Common equity on the firm’s balance sheet is 60% of its total assets. What is its net income?

Write about Socio- economic aspect of rising house prices : Write on given topic. Topic - Socio- economic aspect of rising house prices of low income household in Australia. Word Count: 2500 - 3000 words

Determine the project cash flows in actual dollars : Determine the project cash flows in actual dollars. Determine the project cash flows in constant (time-zone) dollars.

What is your estimate of the stock current price : A company currently pays a dividend of $1.75 per share (D0 = $1.75). It is estimated that the company's dividend will grow at a rate of 19% per year.

Calculate the required pre retirement real annual savings : Calculate the required pre retirement real annual savings necessary to meet your consumption goals.

What items in the balance sheet or income statement : What item or items in the balance sheet or income statement of an manufacturing company would likely be affected.

Calculate the annual debt-service payments : A company financed with 100% equity has a cost of capital equal to approximately 10%. This firm has only one asset: a chemical plant capable of generating.

Investment plan for the education of their daughter : You are working as a financial planner. A couple has asked you to put together an investment plan for the education of their daughter.

User Account

All Pages