Divided between a capital gains yield and a dividend yield

Assignment Help Financial Management

Reference no: EM131048117

Suppose you know that a company’s stock currently sells for $63 per share and the required return on the stock is 13 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield. If it’s the company’s policy to always maintain a constant growth rate in its dividends, what is the current dividend per share?

Reference no: EM131048117

Questions Cloud

Manufacturing plant-find the rate of return : You are considering an upgrade at a chip manufacturing plant. A new VLSI testing station costs $100,000, installed. It will save $50,000 per year in labor costs. Use five-year tax life and a tax rate of 40%. Find the rate of return (IRR)

When does an auditor do analytical procedures : when does an auditor do analytical procedures?

Two out of the three types of development : 2. Evaluate a study for each of the two types of development you have chosen, that could be used within the topic of attachment to either support or refute the idea you have presented. Appropriate studies for you to evaluate have been given in the..

Begin paying annual dividends : NU YU announced today that it will begin paying annual dividends. The first dividend will be paid next year in the amount of $0.45 a share. The following dividends will be $0.50, $0.65, and $0.95 a share annually for the following three years, respec..

Divided between a capital gains yield and a dividend yield : Suppose you know that a company’s stock currently sells for $63 per share and the required return on the stock is 13 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield. If it..

About the cost of trade credit : Cost of Trade Credit Calculate the nominal annual cost of nonfree trade credit under each of the following terms. Assume payment is made either on the due date or on the discount date. Assume 365 days in year for your calculations. Do not round inter..

Outstanding student loan with required payments : You have an outstanding student loan with required payments of $550 per month for the next four years. The interest rate on the loan is 8% APR (compounded monthly). Looking at your budget, you can afford to pay an extra $150 a month in addition to yo..

Express the formula and draw the payoff from this bond : In 1986 Standard Oil issued some bonds. At T, investors received $1000 and an additional amount based on the oil price at that time. The additional amount was 170 times the excess of the oil price over $25. The maximum additional amount paid was $255..

Discuss the theoretical view that the review process consist : discuss the theoretical view that the review process consist

User Account

All Pages