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Apple currently pays no dividend but its new management will pay a dividend at the end of Year 4. Year 4 earnings are expected to
Apple currently pays no dividend but its new management will pay a dividend at the end of Year 4. Year 4 earnings are expected to be $2.97, and apple will maintain a payout ratio of 47%. With an assumption that apple's constant growth rate is 3.42%, and a required rate of return of 7.17%, the present value of apple is closest to
1. $30.24.
2. $49.71.
3. $70.92.
4. $91.86.
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