Common stock valuation) Assume the following: the investor's required rate of return is 14 percent, the expected level of earnings at the end of this year (E,) is $14, the retention ratio is 30 percent, the return on equity (ROE) is 16 percent (that is, it can earn 16 percent on reinvested earnings), and similar shares of stock sell at multiples of 7.609 times earnings per share. Ruestions: Determine the expected growth rate for dividends. - Determine the price earnings ratio (PIE,). What is the stock price using the PIE ratio valuation method? .What is the stock price using the dividend discount model? .What would happen to the PE ratio (PIE,) and stock price if the company increased its retention rate to 70 percent (holding all else constant)? What would happen to the P/E ratio (PIE,) and stock price if the com vidends? What have you learned about the relationship between the retention rate and the PE ratios?

A stock is expected to pay dividends in 8 periods.  The first dividend will be $2.55 and subsequent dividends are forecasted to stay constant for the foreseeable future.  If the required return on the stock is 11.0%, what is its current value?

What is the intrinsic value of a stock which last paid a dividend of $3.25 and is expected to grow at 17% over the next 2 years after which it will settle down at a stable rate of 8% per annum? The investor’s required rate of return is 12.5%.

A stock is expected to pay a dividend of $1.76 at the end of the year. The required rate of return is rs = 16.07%, and the expected constant growth rate is g = 4.2%. What is the stock's current price?Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72.

A stock will pay a dividend of $3.5 and is expected to sell for $87.8 in one year.  If the current price is$19.4, what is the return.  Answer as a percent. Answer:

A stock just paid a dividend of $1.70 and is expected to grow its dividends indefinitely at a constant annual growth rate of 2.2%. Using a required rate of return (or discount rate) of  14%, calculate the current fair value for this stock.

You are evaluating a company's stock. The stock just paid a dividend of $1.75. Dividends are expected to grow at a constant rate of 5 percent for a long time into the future. The required rate of return (Rs) on the stock is 12 percent. What is the fair present value? Please show all the steps, including the equation(s).

A stock is expected to pay a dividend of $0.75 at the end of the year.  The required rate of return is r = 10.5%, and the expected constant growth rate is g = 5.6%.  What is the stock's current price?

Consider the stock of Davidson Company that will pay an annual dividend of 2 in the coming year. The dividend is wxpected to grow at a constant rate of 5 percent permanently. The market requires a 12-percent return on the company. What is the current price of share of the stock?

A stock is selling for $50 in the market. The required rate of return is 9%. The most recent dividend paid is D0 = $3.0 and dividends are expected to grow at a constant rate g. What’s the expected capital gain for this stock?