A company currently pays a dividend of 25 per share d0 25


A company currently pays a dividend of $2.5 per share, D0 = 2.5. It is estimated that the company's dividend will grow at a rate of 18% percent per year for the next 2 years, then the dividend will grow at a constant rate of 7% thereafter. The company's stock has a beta equal to 0.8, the risk-free rate is 4.5 percent, and the market risk premium is 6 percent. What is your estimate is the stock's current price? Round your answer to the nearest cent.

Request for Solution File

Ask an Expert for Answer!!
Financial Management: A company currently pays a dividend of 25 per share d0 25
Reference No:- TGS01159084

Expected delivery within 24 Hours