Question
A company that currently does not pay dividends on its stock is expected to begin paying a constant annual dividend 8 years from now in
A company that currently does not pay dividends on its stock is expected to begin paying a constant annual dividend 8 years from now in the amount of $3.25 per share. The company is expected to maintain this dividend for 6 years and then cease paying dividends forever. Assume the required return on this stock is 12%. What will this stock sell for 7 years from now?
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The Analysis And Use Of Financial Statements
Authors: Gerald I. White, Ashwinpaul C. Sondhi, Haim D. Fried
2nd Edition
0471111864, 978-0471111863
