EZ Electronics just paid a dividend of $10 and currently pays out all its income in the

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EZ Electronics just paid a dividend of $10 and currently pays out all its income in the form of dividends. The new CEO of EZ thinks that by investing 50% of earnings he can grow earnings at 10% for the next 3 years and then at the sustainable growth rate given an ROE of 12% in perpetuity. The cost of capital of the firm is 14%. How much will this impact the stock price?

Posted Date: Jul 01, 2024 10:02 PM

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EZ Electronics just paid a dividend of $10 and currently pays out all its income in the

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