Annual dividend on common stock

Assignment Help Financial Management

Reference no: EM131323966

The last annual dividend on KCBT Corporation's common stock, paid yesterday, was $0.50. If you require a rate of return of 10 percent, If you expect the dividends on KCBT to grow at a constant rate of 9 percent, what is the highest price you should be willing to pay for this stock?

Reference no: EM131323966

Questions Cloud

What possible avenues exist for him to achieve growth : Captivate Remodeling is a small, owner-managed construction company. The owner, Bob, typically works on a single residential remodeling project at a time. The business is very simple because Bob does not carry any inventory. How much capital will Bo..

What is the net present value of investment : You are making an investment of $110,000 and require a rate of return of 14.6 percent. You expect to receive $48,000 in the first year, $52,500 in the second year, and $55,000 in the third year. There will be a cash outflow of $900 in the fourth year..

Considering project with an initial cost : Corner Restaurant is considering a project with an initial cost of $211,600. The project will not produce any cash flows for the first three years. Starting in Year 4, the project will produce cash inflows of $151,000 a year for three years. This pro..

Forecast market movements by analyzing price-volume trends : James Cramer is the head Technical Analyst on thestreet.com. That is, he attempts to forecast market movements by analyzing price and volume trends. Which of the following statements is MOST correct about the Efficient Market Hypothesis (“EMH”)?

Annual dividend on common stock : The last annual dividend on KCBT Corporation's common stock, paid yesterday, was $0.50. If you require a rate of return of 10 percent, If you expect the dividends on KCBT to grow at a constant rate of 9 percent, what is the highest price you should b..

The bond is convertible into common stock : For each of the following characteristics which a bond may have, would their presence tend to increase or decrease the yield to maturity. The bond is convertible into common stock.

Calculate the new bond price : Consider a 8 percent coupon bond with nine years to maturity and a current price of $1,036.80. Suppose the yield on the bond suddenly increases by 2 percent. Use duration to estimate the new price of the bond. Calculate the new bond price.

What is the modified duration : What is the Macaulay duration of a 5.8 percent coupon bond with eleven years to maturity and a current price of $1,060.10? What is the modified duration?

What is the percentage price change of these bonds : Bond J is a 8 percent coupon bond. Bond K is a 12 percent coupon bond. Both bonds have 12 years to maturity and have a YTM of 9.5 percent. If interest rates suddenly rise by 1 percent, what is the percentage price change of these bonds?

User Account

All Pages