Question
The dividend that was just paid for ABC stock was $3.25. The company is expected to grow at 6% in the next 4 years and
The dividend that was just paid for ABC stock was $3.25. The company is expected to grow at 6% in the next 4 years and then have a constant growth of 3% after that forever. The cost of capital (equity) is 5%. What should be the stock price of this company now?
A. $153.12
B. $172.67
C. $187.33
D. $198.77
E. $213.15
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
Concise 6th Edition
324664559, 978-0324664553
