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Please show work, thanks! Comcast recently paid a dividend of $.50 per share. Yesterday, they announced that the dividend will grow next year by 8%
Please show work, thanks!
Comcast recently paid a dividend of $.50 per share. Yesterday, they announced that the dividend will grow next year by 8% and will grow at 10% for the two years following, after which time the dividends will increase by 3% annually. The required return on this stock is 9.5%. Show your work for partial credit. a. What is the current value per share? (use of the table is not required) Dividend Growth rate FV N I PMT PV 8% 10% 10% 3% constant b. If the current market price of Comcast is $8.22 per share, is this stock under-or over-valued in the market? Would you buy or sell based on the valuation vs. the market priceStep by Step Solution
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