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You are considering purchasing shares of common stock of HP. You observe in todays Wall Street Journal that HP is selling for $91. You expect
You are considering purchasing shares of common stock of HP. You observe in todays Wall Street Journal that HP is selling for $91. You expect that HP will pay a dividend of $4.70 in 2021, $4.95 in 2022, and $5.25 in 2023. Assuming that you sell the stock immediately after the dividend payment in 2023 and the stock market is efficient, at what price would you have to sell it for in 2023 to yield an expected return of 11% on your investment.
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