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Suppose the dividends for the Seger Corporation over the past six years were $1.06, $1.14, $1.23, $1.31, $1.41, and $1.46, respectively. Assume that the historical
Suppose the dividends for the Seger Corporation over the past six years were $1.06, $1.14, $1.23, $1.31, $1.41, and $1.46, respectively. Assume that the historical average growth rate will remain the same for 2017. Compute the expected share price at the end of 2017 using the perpetual growth method. Assume the market risk premium is 12.9 percent, Treasury bills yield 6.2 percent, and the projected beta of the firm is 0.79.
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