Question
plz give answer quickly. a. Tim Hortons just paid a dividend of $3.20 on its stock. The growth rate in dividends is expected to be
plz give answer quickly.
a. Tim Hortons just paid a dividend of $3.20 on its stock. The growth rate in dividends is expected to be a constant 5 percent per year indefinitely. Investors require a 15 percent return on the stock for the first three years, a 13 percent return for the next three years, and an 11 percent return thereafter forever. What is the current share price? show simple calculations plz.
b. Why does the value of stock depend on dividends? A substantial percentage of public companies dont pay dividends, then how could investors value this kind of company? (2 marks)
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