Patience, Inc., just paid a dividend of $2.35 per share on its stock. The dividends are expected
Question:
Patience, Inc., just paid a dividend of $2.35 per share on its stock. The dividends are expected to grow at a constant rate of 4.5 percent per year, indefinitely. If investors require an 11 percent return on this stock, what is the current price? What will the price be in three years? In 15 years?
DividendA dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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The constant dividend growth model is P t D t 1 g R g So the price of the stock today is P 0 D 0 1 g ...View the full answer
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Anurag Agrawal
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Related Book For 
Essentials Of Corporate Finance
ISBN: 9780073382463
7th Edition
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
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