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CONSTANT GROWTH You are considering an investment in Justus Corporation's st which is expected to pay a dividend of $2.25 a share at the end
CONSTANT GROWTH You are considering an investment in Justus Corporation's st which is expected to pay a dividend of $2.25 a share at the end of the year (D $2.25) an has a beta of 0.9. The risk-free rate is 4.9%, and the market risk premium is 5%. Justus sells for $46.00 a share, and its dividend is expected to grow at some constant rate, 8 Assuming the market is in equilibrium, what does the market believe will be the stock price at the end of 3 years? (That is, what is P3?) currertiy
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