Answered step by step
Verified Expert Solution
Question
...
1 Approved Answer
According to the 2018 prospectus of Universal Thermal Sciences Ltd the firms planned dividend policy is to pay no dividends for the next several years
According to the 2018 prospectus of Universal Thermal Sciences Ltd the firms planned dividend policy is to pay no dividends for the next several years due to a substantial R&D program. The firm anticipates distributing a maiden $0.20 dividend in 2023. This dividend is expected to continue increasing at a 4% annual rate indefinitely. If the appropriate discount rate is 18%, what is today theoretical share price for UTS (i.e., in 2018)?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started