What price per share should the stock move immediately

Reference no: EM133273732

Question - Lempro Inc. has met with investors and laid out a plan to change the amount it pays in dividends. It is planning to pay an equal dividend at the end of each of the next three years (starting at t=1) in the amount of $2.70; and thereafter increase the dividend 2.5% each year indefinitely. Upon hearing this news, to what price per share should the stock move immediately in anticipation of the new expected stream of dividends, given an 8% cost of equity (discount rate)?

Reference no: EM133273732

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