Question
Common stock value: Constant growthSeagate Technology is a global leader in data storage solutions and a high-yield dividend payer. From 2015 through 2019, Seagate paid
Common stock value: Constant growthSeagate Technology is a global leader in data storage solutions and a high-yield dividend payer. From 2015 through 2019, Seagate paid the following per-share dividends:
Year Dividend per share
2019 $2.56
2018 $2.26
2017 $1.83
2016 $1.15
2015 $ 1.48
Assume that the historical annual growth rate of Seagate dividends is an accurate estimate of the future constant annual dividend growth rate. Use a 20% required rate of return to find the value of Seagate's stock immediately after it paid its 2019 dividend of $2.56. The value of Seagate's stock is ?
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