What price does dividend-discount model predict

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Reference no: EM132033066

Colgate-Palmolive Company has just paid an annual dividend of $ 1.50. Analysts are predicting dividends to grow by $ 0.12 per year over the next five years. After then, Colgate's earnings are expected to grow 6.0 % per year, and its dividend payout rate will remain constant. If Colgate's equity cost of capital is 8.5 % per year, what price does the dividend-discount model predict Colgate stock should sell for today? Round answer to two decimal places.

Reference no: EM132033066

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