The next dividend payment by Savitz, Inc., will be $1.76 per share. The dividends are anticipated to maintain a growth rate of 7 percent forever. The stock currently sells for $34 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? (Enter your answer as a percent.) a. Dividend yield b. Capital gains yield % %

Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter7: Corporate Valuation And Stock Valuation
Section: Chapter Questions
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The next dividend payment by Savitz, Inc., will be $1.76 per share. The dividends are
anticipated to maintain a growth rate of 7 percent forever. The stock currently sells for
$34 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? (Enter your answer as a percent.)
%
%
a. Dividend yield
b. Capital gains yield
Transcribed Image Text:The next dividend payment by Savitz, Inc., will be $1.76 per share. The dividends are anticipated to maintain a growth rate of 7 percent forever. The stock currently sells for $34 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? (Enter your answer as a percent.) % % a. Dividend yield b. Capital gains yield
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