67 b. Now assume that TTC's period of high growth is to last for 5 years rather than 2 years. 68 affect its price, dividend yield, and capital gains yidd? How would this 70 1. Find the price today. $1.60 10.0% 20% 6% Short-run high growth for Years 1-5 only Long-run constants: for Year 6 and all following years 1 Year Dividend 2 3 PV of dividends Terminal value =P 91 Part 2. Finding the expected dividend yield. D 93 Dividend yield - 94 Dividend yield 95 Dividend yield- 98 Part 3. Finding the expected capital gains yield. - Dividend yidd 100 Cap. Gain yield- Expected retum 101 Cap. Gain yield- 102 Cap. Gain yield 103 104 c. What will TTC dividend yield and capital gains yidd be once its period of high growth ends? (Hint These values will be the same regardless of whether you examine the case of 2 or 5 years of supernormal growth, ins and the calculations are very easy.) 107 110 Dividend yield- 111 Dividend yield- 112 Dividend vidd - Dividend yield 114 Cap. Gain yield - Expected return 115 Cap. Gain yield- 116 Cap. Gain yield- 117 67 b. Now assume that TTC's period of high growth is to last for 5 years rather than 2 years. 68 affect its price, dividend yield, and capital gains yidd? How would this 70 1. Find the price today. $1.60 10.0% 20% 6% Short-run high growth for Years 1-5 only Long-run constants: for Year 6 and all following years 1 Year Dividend 2 3 PV of dividends Terminal value =P 91 Part 2. Finding the expected dividend yield. D 93 Dividend yield - 94 Dividend yield 95 Dividend yield- 98 Part 3. Finding the expected capital gains yield. - Dividend yidd 100 Cap. Gain yield- Expected retum 101 Cap. Gain yield- 102 Cap. Gain yield 103 104 c. What will TTC dividend yield and capital gains yidd be once its period of high growth ends? (Hint These values will be the same regardless of whether you examine the case of 2 or 5 years of supernormal growth, ins and the calculations are very easy.) 107 110 Dividend yield- 111 Dividend yield- 112 Dividend vidd - Dividend yield 114 Cap. Gain yield - Expected return 115 Cap. Gain yield- 116 Cap. Gain yield- 117