Question
Stock in Country Road Industries has a beta of 1.15. The market risk premium is 9 percent, and T-bills are currently yielding 3 percent. The
Stock in Country Road Industries has a beta of 1.15. The market risk premium is 9 percent, and T-bills are currently yielding 3 percent. The company's most recent dividend was $1.7 per share, and dividends are expected to grow at a 6 percent annual rate indefinitely. If the stock sells for $37 per share, what is your best estimate of the company's cost of equity?
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Fundamentals of Corporate Finance
Authors: Stephen A. Ross, Randolph W. Westerfield, Bradford D.Jordan
8th Edition
978-0073530628, 978-0077861629
