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Need help for my homework as my calculator isn't giving me the right answer. 1 the target share price five years from 30. PE and
Need help for my homework as my calculator isn't giving me the right answer.
1 the target share price five years from 30. PE and Terminal Stock Price In practice, a common way to value a share of stock when a company pays dividends is to value the dividends over the next five years or so, then find the terminal" stock price using a benchmark PE ratio. Suppose a company just paid a dividend of $1.15. The dividends are expected to grow at 10 percent over the next five years. The company has a payout ratio of 40 percent and a benchmark PE of 19. What is the target stock price in five years? What is the stock price today assuming a required return of 11 percent on this stock Step by Step Solution
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