Question
What is the value of a stock, using dividend growth model, if the dividend is $3, your required rate of return is 8%, and the
What is the value of a stock, using dividend growth model, if the dividend is $3, your required rate of return is 8%, and the annual rate of dividend growth is 3%? ________________________________________________
In the situation from #1 above, what is the value of the stock if the dividend is decreased to $2.50? ________________________________________________
In the situation from #1 above, what is the value of the stock if the dividend is $2.50 and the required rate of return is lowered to 6%? ________________________________________________
In the situation from #1 above, what is the value of the stock if all is the same except the dividend growth rate is 5%? ________________________________________________
XYZ stock sells for $25 and pays an annual per share dividend of $1.50. It is expected to grow annually at 8%. What is your expected return on this stock? ________________________________________________
In the situation from question #5, what would be the expected return if the price of the stock was $35? ________________________________________________
The risk free rate is 2%. The expected return on the market is 6%. Stock M has a beta coefficient of 1.4. The dividend growth rate is 5%, and the dividend is $2.60 per share. What is the value for the required return? ________________________________________________
In the situation from question #7, what is the expected price of the stock given the required return you found in problem #7? _________________________________________________
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