Question
Weaver Brothers expects to earn $3.50 per share (E), and has an expected dividend payout ratio of 60%. Its expected constant dividend growth rate is
Weaver Brothers expects to earn $3.50 per share (E), and has an expected dividend payout ratio of 60%.
Its expected constant dividend growth rate is 6.2%, and its common stock currently sells for $30 per share.
New stock can be sold to the public at the current price, but a flotation cost of 5% would be incurred. What would be the cost of equity from new common stock?
Your answer should be between 10.15 and 16.90, rounded to 2 decimal places, with no special characters.
Weaver Brothers expects to earn $3.50 per share (E), and has an expected dividend payout ratio of 60%.
Its expected constant dividend growth rate is 6.2%, and its common stock currently sells for $30 per share.
New stock can be sold to the public at the current price, but a flotation cost of 5% would be incurred. What would be the cost of equity from new common stock?
Your answer should be between 10.15 and 16.90, rounded to 2 decimal places, with no special characters.
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Advanced Accounting
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
10th edition
0-07-794127-6, 978-0-07-79412, 978-0077431808
