Problem 9-3 Stock Values The next dividend payment by Im, Incorporated, 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. a. What is the dividend yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the expected capital gains yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Dividend yield b. Capital gains yield % %

Problem 9-3 Stock Values The next dividend payment by Im, Incorporated, 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. a. What is the dividend yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the expected capital gains yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Dividend yield b. Capital gains yield % %

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 15P: Return on Common Stock You buy a share of The Ludwig Corporation stock for $21.40. You expect it to...

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Problem 9.27 Staggert Corp. will pay dividends of $5.00, $6.25, $4.75, and $3.00 in the next four years. Thereafter, the company expects its dividend growth rate to be constant at 8.5 percent. If the required rate of return is 17.0 percent, what is the current value of the stock? (Round intermediate calculations and final answer to 2 decimal places, e.g. 16.25.) Current value Click if you would like to Show Work for this question: Open Show Work
#26 The market price of a stock is $21.68 and it is expected to pay a dividend of $1.13 next year. The required rate of return is 11.04%. What is the expected growth rate of the dividend? Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924))
Question 6 You observe a stock price of $17. You expect a dividend growth rate of 5% and the current year's dividend was $1.70. What is the required return? 15.5% 15% 10%
Question 03 Current forecasts are for XYZ Company to pay dividends of OMR 2.000, OMR 2.350, OMR 2.600and OMR 2.850 over the next four years, respectively. At the end of four years you anticipate selling your stock at a market price of OMR 108.58. Required: What is the price of the stock given a 12% expected return?
QUESTION FIVE A. A stock originally sold for K25 per share and ten years later, now sells for K40.The dividend last paid was K10. Find the Dividend yield and capital gains yield and total yield or return? B. Tomorrow Investments Ltd. just paid a divided of K2.00 in 2019 and the dividend is expected to grow at 15% for the next 3years and thereafter decline to 10%. The required rate of return on the stock is 18%. Find the value of the stock. C. The Blue Dog Company has common stock outstanding that has a current price of $20 per share and a $0.5 dividend. Blue Dog’s dividends are expected to grow at a rate of 3% per year, forever. The expected risk-free rate of interest is 2.5%, whereas the expected market premium is 5%. The beta on Blue Dog’s stock is 1.2. What is the cost of equity for Blue Dog using the dividend valuation model and What is the cost of equity for Blue Dog using the capital asset pricing? model? [
Select the best Question 24 Reddick Enterprises' stock currently sells for $35.50 per share. The dividend is projected to increase at a constant rate of 5.50% per year. The required rate of return on the stock (I/Yr) is 9.00%. What is the stock's expected dividend in 3 years (Div3)? O 146 O 224 O 1.76 O 2.00 O 1.24
Problem 9.16 The preferred stock of Axim Corp. is currently selling at $48.95. If the required rate of return is 11.6 percent, what is the dividend paid by this stock? (Round answer to 2 decimal places, e.g. 15.25.) Dividend paid
ADC 1) Based on End-of-Chapter Problem 6 in Chapter 5 The stock of Business Adventures sells for $40 a share. Its likely dividend payout and end- of-year price depend on the state of the economy by the end of the year as follows: Stock Price Dividend. $2.00 $50 1.00 43 0.50 34 a. Calculate the expected holding-period return and standard deviation of the holding- period return. All three scenarios are equally likely. Boom Normal economy Recession b. Calculate the expected return and standard deviation of a portfolio invested half in Business Adventures and half in Treasury bills. The return on bills is 4%.
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Rework Table 74 for horizon years 1, 2, 3, and 10, assuming that investors expect the dividend and the stock price to increase at only 6% a year and that each investor requires the same 12% expected return. The company will pay a dividend of $3 at the end of the first year. What value would an investor place on the stock? Do not round intermediate calculations. Round your answers to 2 decimal places. Horizon (years) 1 2 3 10 PV (Dividends) $ 3.18 PV (Terminal Price) Value per Share S 50.00 53.00 50.17 71.95
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