What the cost of equity for ajax using dividend valuation

Reference no: EM13291098

Ajax, Inc. has common stock outstanding that has a market price of $48 per share. Last year's dividend was $2.25 and is expected to grow at a rate of 4% per year, forever. The expected risk-free rate of interest is 2%, and the expected market premium is 5.5%. The company's beta is 1.2.

What is the cost of equity for Ajax using the dividend valuation model?

Reference no: EM13291098

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