Dividends are expected to grow at a constant rate

Assignment Help Financial Management
Reference no: EM13882270

The Jackson–Timberlake Wardrobe Co. just paid a dividend of $1.10 per share on its stock. The dividends are expected to grow at a constant rate of 5 percent per year indefinitely. Investors require a return of 11 percent on the company's stock. What will the stock price be in 14 years?

Reference no: EM13882270

Questions Cloud

Dividend payment-what is the dividend yield : The next dividend payment by Blue Cheese, Inc., will be $1.64 per share. The dividends are anticipated to maintain a growth rate of 8 percent forever. The stock currently sells for $31 per share. What is the dividend yield? What is the expected capit..
An ordinary annuity has an interest rate : An ordinary annuity has an interest rate of 10% and a future value of 80.00. What would be the future value of this same annuity, if it were an annuity due instead of a regular annuity? The future value of this annuity due is $
What is the delivered price of the living room set : Levin Furniture buys a living room set with a $4,700 list price and a 50% trade discount. Freight (FOB shipping point) of $45 is not part of the list price. What is the delivered price (including freight) of the living room set, assuming a cash disco..
Write a menu driven program that accepts words : Write a menu driven program that either accepts words and their meanings, or displays the list of words in lexicographical order (i.e. as in a dictionary).
Dividends are expected to grow at a constant rate : The Jackson–Timberlake Wardrobe Co. just paid a dividend of $1.10 per share on its stock. The dividends are expected to grow at a constant rate of 5 percent per year indefinitely. Investors require a return of 11 percent on the company's stock. What ..
How education is shaping social inequality : How education is shaping social inequality
Maintain constant growth rate in its dividends : Suppose you know that a company’s stock currently sells for $51 per share and the required return on the stock is 11 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..
What tactics would you avoid and why : If you were launching a real campaign, what other tactics you would use and why (they may or may not be in the above list)? How will your promotion strategies address the diversity of your customer base? What tactics would you avoid and why
Encounter forms and aging reports : Describe the purpose of the encounter form and what impact does managing claims according to this model have on the financial health of the practice?

Reviews

Write a Review

 

Financial Management Questions & Answers

  What is the market value of the outstanding preferred stock

Jones Design wishes to estimate the value of its out-standing preferred stock. The preferred issue has an $80 par value and has a dividend rate of 8 percent. Similar-risk preferred stocks are currently earning a 12% annual rate of return. What is the..

  What is the firms net profit margin

A firm had net income of $100,000, taxes of $25,000 interest expenses of $10,000, cash of $15,000, depreciation of $12,000, and selling and administrative expenses of $120,000. What was the firm’s revenue? What is the firm’s net profit margin?

  How are future values affected by changes in interest rates

How are future values affected by changes in interest rates?

  Standard sinking fund method repayment at rate

Show that the borrower’s periodic outlay for a standard sinking fund method repayment at rate j is larger than the level outlay under amortization method with the interest rate i, if i > j

  Explaining the different types of money market instruments

You are hired as the Assistant Treasurer for a company. Your firm has $ 10 million in excess cash it does not plan on needing for the next six months. These funds however do include some contingency funds that are kept if unexpected funds needs arise..

  Firms recent earnings per share and dividend per share

Suppose that a firm’s recent earnings per share and dividend per share are $2.90 and $1.90, respectively. Both are expected to grow at 9 percent. However, the firm’s current P/E ratio of 28 seems high for this growth rate. The P/E ratio is expected t..

  Present value calculations

Present value calculations:

  What is the book value of klingons total assets today

Klingon Widgets, Inc., purchased new cloaking machinery three years ago for $6 million. The machinery can be sold to the Romulans today for $5.2 million. Klingon’s current balance sheet shows net fixed assets of $4 million, current liabilities of $77..

  The beta of a portfolio of stocks

The beta of a portfolio of stocks is:

  Used to estimate the cost of equity capital

If the CAPM is used to estimate the cost of equity capital, the expected excess market return is equal to

  How the inflation rate would affect the return

Explain your reasoning. Be sure to consider how the inflation rate would affect the return - A leader in your firm has been studying the foreign exchange market for a number of years and believes that she can predict several of the foreign currency..

  What is the yield-to maturity and yield-to-call

A 5-year, $1000-par, 4% coupon bond is callable in 2 years at par. If the current price of the bond is $980, what is the yield-to maturity and yield-to-call?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd