Compute dividends over the next five years

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Reference no: EM131575460

Suppose that a firm’s recent earnings per share and dividend per share are $2.40 and $1.40, respectively. Both are expected to grow at 8 percent. However, the firm’s current P/E ratio of 23 seems high for this growth rate. The P/E ratio is expected to fall to 19 within five years. Compute the dividends over the next five years. (Do not round intermediate calculations and round your final answers to 3 decimal places.)

Reference no: EM131575460

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