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Consider four different stocks, all of which have a required return of 16 percent and a most recent dividend of $2.80 per share. Stocks W,
Consider four different stocks, all of which have a required return of 16 percent and a most recent dividend of $2.80 per share. Stocks W, X, and Y are expected to maintain constant growth rates in dividends for the foreseeable future of 8 percent, 0 percent, and -5 percent per year, respectively. Stock Z is a growth stock that will increase its dividend by 20 percent for the next two years and then maintain a constant 12 percent growth rate, thereafter. Requirement 1: What is the dividend yield for each of these four stocks? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) Dividend yield Stock W Stock X Stock Y Stock Z Requirement 2: What is the expected capital gains yield for each of these four stocks? (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Round your answers to 2 decimal places (e.g., 32.16).) Capital gains yield Stock W Stock X Stock Y Stock Z
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