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Assume Merck (MRK) just finished paying an annual dividend of $1.7 (for 2019). You look up their beta and it equals 0.40 , implying it's
Assume Merck (MRK) just finished paying an annual dividend of $1.7 (for 2019). You look up their beta and it equals 0.40 , implying it's much less risky than the market portfolio. The current risk free rate equals 1.30 %. Assume a market risk premium of 7.3 %. Merck's current stock price is $79. Assuming investors expect Merck to grow at a constant rate in perpetuity, what is that growth rate expectation?
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