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Momsen Corp. is experiencing rapid growth. Dividends are expected to grow at 25percent per year during the next three years, 15percent over the following year, and then 6 percent per year indefinitely. The required return on this stock is 10 percent, and the stock currently sells for $79per share. What is the projected dividend for the coming year?
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Metallica Bearings, Inc., is a young
start-up company. No dividends will be paid on the stock over the next nine years
because the firm needs to plow back its earnings to fuel growth. The company will pay a
$17 per share dividend 10 years from today and will increase the dividend by 3.9 percent
per year thereafter. If the required return on this stock is 12.5 percent, what is the current
share price?
Metallica Bearings, Inc., is a young
start-up company. No dividends will be paid on the stock over the next nine years
because the firm needs to plow back its earnings to fuel growth. The company will pay a
$17 per share dividend 10 years from today and will increase the dividend by 3.9 percent
per year thereafter. If the required return on this stock is 12.5 percent, what is the current
share price?
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