Question
1. ABC Enterprises' stock is expected to pay a dividend of $1.2 per share.The dividend is projected to increase at a constant rate of 3.2%
1. ABC Enterprises' stock is expected to pay a dividend of $1.2 per share.The dividend is projected to increase at a constant rate of 3.2% per year.The required rate of return on the stock is 12.7%.What is the stock's expected price 3 years from today (i.e. solve for P3)?
2. ABC just paid a dividend of D0 = $4.9.Analysts expect the company's dividend to grow by 30% this year, by 22% in Year 2, and at a constant rate of 5% in Year 3 and thereafter.The required return on this stock is 12%.What is the best estimate of the stock's current market value?
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Auditing A Practical Approach with Data Analytics
Authors: Raymond N. Johnson, Laura Davis Wiley, Robyn Moroney, Fiona Campbell, Jane Hamilton
1st edition
1119401747, 978-1119401742
