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Stock in Dragula Industries has a beta of 1.3. The market risk premium is 7 percent, and T-bills are currently yielding 4.50 percent. The companys
Stock in Dragula Industries has a beta of 1.3. The market risk premium is 7 percent, and T-bills are currently yielding 4.50 percent. The companys most recent dividend was $1.50 per share, and dividends are expected to grow at a 8.0 percent annual rate indefinitely.
If the stock sells for $36 per share, what is your best estimate of the companys cost of equity?(Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
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