What will the price be in three years and current price

Assignment Help Financial Management

Reference no: EM131337918

The Starr Co. just paid a dividend of $1.80 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year, indefinitely. Investors require a return of 11 percent on the stock.

What is the current price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

What will the price be in three years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

What will the price be in 16 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Reference no: EM131337918

Questions Cloud

Return on your investment in lion equity : Lion Equity paid an annual dividend of $3.25 per share last month, and it is anticipated that future dividends will increase by 4% annually. As a shareholder, if you require a 11% return on your investment in Lion Equity, how much are you willing pay..

What should the stock be currently selling for : Charming Shoppes will pay an annual dividend of $2.50 next year with future dividends increasing by 4% annually. If the market rate of return on this stock is 12%, what should the stock be currently selling for? The Clark Group pays an annual dividen..

At what price will the stock reach equilibrium : A share of stock with a beta of .77 now sells for $50. Investors expect the stock to pay a year-end dividend of $3. The T-bill rate is 4%, and the market risk premium is 8%. Suppose investors believe the stock will sell for $52 at year-end. Is the st..

What foreign exchange exposures do your company have : There is an increasing demand in the US to learn Spanish because many students want to study abroad in Latin American countries and an increase Hispanic population in the US. What foreign exchange exposures do your company have? How does peso depreci..

What will the price be in three years and current price : The Starr Co. just paid a dividend of $1.80 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year, indefinitely. Investors require a return of 11 percent on the stock. What will the price be in three year..

Should investors buy-hold or sell the stock of walmart : Creditors should loan money to Walmart in the long-term. Should investors buy, hold, or sell the stock of Walmart?

Investors expectation of price of the stock at end of year : A share of stock with a beta of .84 now sells for $59. Investors expect the stock to pay a year-end dividend of $4. The T-bill rate is 3%, and the market risk premium is 6%. If the stock is perceived to be fairly priced today, what must be investors’..

What is rate of return on this security : Enrite Gas recently paid a $4.75 annual dividend on its common stock, which is expected to increase at an average rate of 3.5% per year. If the stock is currently trading for $39.33 per share, what is its market rate of return? The preferred stock of..

Willing pay to purchase one share of stock in lion equity : Lion Equity paid an annual dividend of $3.25 per share last month, and it is anticipated that future dividends will increase by 4% annually. As a shareholder, if you require a 11% return on your investment in Lion Equity, how much are you willing pay..

User Account

All Pages