A fast growing firm recently paid dividend
Course:- Financial Management
Reference No.:- EM13891890

Assignment Help >> Financial Management

A fast growing firm recently paid a dividend of $1.00 per share. The dividend is expected to increase at a rate of 15 percent rate for the next 3 years. Afterwards, a more stable 6 percent growth rate can be assumed. If a 10 percent discount rate is appropriate for this stock, what is its value?

Put your comment

Ask Question & Get Answers from Experts
Browse some more (Financial Management) Materials
You are reviewing your portfolio for which you know that 10 years ago you invested $17,850 in Amazon stock (AMZN). You are pleasantly surprised that the current value of the s
Assume that you won the lotto or lottery jackpot for 20 million further assume that you were offered a choice to receive the 20 million today or receive it and equal installme
Many firms believe that it is very difficult to estimate the amount of a possible future contingency. Should a contingent liability be reported even when the dollar amount of
One of the largest losses in history from unauthorized securities trading involved a securities trader for the French bank, Societe Generale. The trader was able to circumvent
Your firm is considering a new product development. an outlay of $90,000 is required for equipment, and an additional net working capital of $5000 is required. What is the pro
Inc. dividend has been consisting of a growth rate of 5.75% a year and at this rate the dividend next year will be $1.55. If the stock is currently selling at $45, what is the
The real risk-free rate of interest is 3%. Inflation is expected to be 2% this year and 5% during the next 2 years. Assume that the maturity risk premium is zero. What is the
Financial analysts forecast Best Buy Company (BBY) growth for the future to be 15.00 percent. Their recent dividend was $1.59. What is the value of their stock when the requir