Dividend discount model and the actual stock price

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You’ve collected the following information from your favorite financial website. 52-Week Price Stock (Div) Div Yld % PE Ratio Close Price Net Chg Hi Lo 77.40 10.43 Palm Coal .36 2.6 6 13.90 –0.24 55.81 33.42 Lake Lead Grp 1.54 3.8 10 40.43 –0.01 130.93 69.50 SIR 2.00 2.2 10 88.97 3.07 50.24 13.95 DR Dime .80 5.2 6 15.43 –0.26 36.70 20.91 Candy Galore 0.49 1.5 28 ?? 0.18 Requirement 1: Using the dividend yield, calculate the closing price for Candy Galore on this day. (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Stock price $ Requirement 2: Assume the actual closing price for Candy Galore was $32.36. Your research projects a 4.50 percent dividend growth rate for Candy Galore. What is the required return for the stock using the dividend discount model and the actual stock price? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Required return %

Reference no: EM131016201

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