Please help check to see if my answers are correct: Triple-A Corporation just paid out a dividend of $2.50 per share. Investors require a 12% rate of return for its stock. The dividend has been growing at a rate of 30% per year in the past three years, but analysts expect that such a high growth rate can only last for another 2 years and, after that, the growth rate will decline and stabilize at 7% per year. a. What is Triple - A's intrinsic stock price today? I got $65.00 b. What is the expected intrinsic price at the end of Year 1? I got $84.60 c.What is the expected (1) dividend yield, - I got 5% (2) capital gains yield - I got 30%, and (3) total return at the end of Year 1 - I got 35% ? Please help check to see if my answers are correct:Triple-A Corporation just paid out a dividend of $2.50per share. Investors require a 12% rate of return for itsstock. The dividend has been growing at a rate of 30%per year in the past three years, but analysts expect thatsuch a high growth rate can only last for another 2years and, after that, the growth rate will decline andstabilize at 7% per year. a. What is Triple - A's intrinsicstock price today? I got $65.00 b. What is the expectedintrinsic price at the end of Year 1 ? I got $84.60 c.What is the expected (1) dividend yield, - I got 5% (2)capital gains yield - I got 30%, and (3) total return atthe end of Year 1 - I got 35 % ?

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Description: Please help check to see if my answers are correct: Triple-A Corporation just paid out a dividend of $2.50 per share. Investors require a 12% rate of return for its stock. The dividend has been growing at a rate of 30% per year in the past three year

Dividend Discount Model is a financial valuation method used to determine the intrinsic value of a…

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A Corporation just paid out a dividend of $2.50 per share. Investors require a 12% rate of return for its stock. The dividend has been growing at a rate of 30% per year in the past three years, but analysts expect that such a high growth rate can only last for another 2 years and, after that, the growth rate will decline and stabilize at 7% per year. a. What is Triple - A's intrinsic stock price today? I got $65.00 b. What is the expected intrinsic price at the end of Year 1? I got $84.60 c. What is the expected (1) dividend yield, - I got 5% (2) capital gains yield - I got 30%, and (3) total return at the end of Year 1 - I got 35% ?

A Corporation just paid out a dividend of $2.50 per share. Investors require a 12% rate of return for its stock. The dividend has been growing at a rate of 30% per year in the past three years, but analysts expect that such a high growth rate can only last for another 2 years and, after that, the growth rate will decline and stabilize at 7% per year. a. What is Triple - A's intrinsic stock price today? I got $65.00 b. What is the expected intrinsic price at the end of Year 1? I got $84.60 c. What is the expected (1) dividend yield, - I got 5% (2) capital gains yield - I got 30%, and (3) total return at the end of Year 1 - I got 35% ?

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter7: Valuation Of Stocks And Corporations

Section: Chapter Questions

Problem 21P

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