Consider a firm that is not currently paying dividends. At the end of 5 years it will
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Consider a firm that is not currently paying dividends. At the end of 5 years it will pay a dividend of $2, which will grow at 3% forever. The risk-free rate is 5%, and the company has an equity Beta of 1.2. The market risk premium is 6%. Using the dividend discount model, what is the fair value for the stock of this company?
Related Book For
Fundamentals Of Corporate Finance
ISBN: 9780135811603
5th Edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
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