How much will you pay for the stock

Assignment Help Financial Management

Reference no: EM131065597

Alexander Corp. will pay a dividend of $4.30 next year. The company has stated that it will maintain a constant growth rate of 4.75 percent a year forever. If you want a return of 12 percent, how much will you pay for the stock? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Reference no: EM131065597

Questions Cloud

What is your estimate of intrinsic value per share : The Digital Electronic Quotation System (DEQS) Corporation pays no cash dividends currently and is not expected to for the next 5 years. Its latest EPS was $16, all of which was reinvested in the company. which it will continue to do forever after. D..

Prepare the cash budget : A firm estimates sales of $150,000 in December, $175,000 in January; $125,000 in February, $200,000 in March, $250,000 in April; $180,000 in May; and $200,000 in June. November sales were $125,000. Prepare the cash budget for January through April. W..

What is the discount yield-bond equivalent yield : What is the discount yield, bond equivalent yield, and effective annual return on a $1 million T-bill that currently sells at 96 3/8 percent of its face value and is 60 days from maturity?

Was postponing her purchase a good trade-off for dorothy : Dorothy lacks cash to pay for a $1,620 dishwasher. She could buy it from the store on credit by making 12 monthly payments of $140. The total cost would then be $1,680. When she goes back to the store, she finds the dishwasher now costs $1,782.00. It..

How much will you pay for the stock : Alexander Corp. will pay a dividend of $4.30 next year. The company has stated that it will maintain a constant growth rate of 4.75 percent a year forever. If you want a return of 12 percent, how much will you pay for the stock?

What price should be set under marginal cost pricing : Assume a clinical laboratory is considering a new test. Here are the key assumptions: annual fixed direct costs = $20,000, annual overhead allocation = $10,000, variable cost per test = $5, and expected volume = 5,000 tests. What price should be set ..

Cost containment-payer negotiations-joint venture activities : The role of finance in healthcare has increased in importance over time because the finance function must support a multitude of activities, such as cost containment, payer negotiations, and joint venture activities.

About the odd dividend policy : Hot Wings, Inc., has an odd dividend policy. The company has just paid a dividend of $10.00 per share and has announced that it will increase the dividend by $8.00 per share for each of the next four years, and then never pay another dividend.

Assess short-term liquidity by looking at firm current ratio : Assume XYZ Corp. had a current ratio of 12.5 You are the CFO of XYZ Corp. Would you argue the high current ratio is good or bad? Why? Ratios provide us with the ability to quickly assess a particular item. We can quickly assess short-term liquidity b..

User Account

All Pages