The Claustrophobic Solution, Inc., a residential window and door manufacturer, has the following historical record of earnings per share (EPS) from 2011 to 2007:
|
2011
|
2010
|
2009
|
2008
|
2007
|
|
EPS
|
$1.10
|
$1.05
|
$1.00
|
$0.95
|
$0.90
|
The company's payout ratio has been 60% over the last five years and the last quoted price of the firm's share of stock was $10. Flotation costs for new equity will be 7%. The company has 30,000,000 of common shares of stock outstanding and a debt-equity ratio of 0.5.
If dividends are expected to grow at the same arithmetic average growth rate of the last five years, what is the dividend payment in 2012?