Question
A stock just paid a dividend of $0.75. This quarterly dividend is expected to grow at a rate of 4% for the next 10 years,
A stock just paid a dividend of $0.75. This quarterly dividend is expected to grow at a rate of 4% for the next 10 years, after which it will remain stable (have zero growth) in perpetuity. What is the price of the stock if the required return is 12% (all rates are APR with quarterly compounding)?
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Modern Financial Markets Prices, Yields, And Risk Analysis
Authors: Mark Griffiths, Drew Winters, David W Blackwell
1st Edition
0470000104, 9780470000106
