10-5: Constant Growth Stocks Valuation of a constant growth stock A stock is expected to pay...

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10-5: Constant Growth Stocks Valuation of a constant growth stock A stock is expected to pay a dividend of $1.25 the end of the year (that is, D1 = $1.25), and it should continue to grow at a constant rate of 8% a year. If its required return is 15%, what is the stock's expected price 1 years from today? Round your answer to two decimal places. 10-8: Preferred Stock Preferred stock valuation Ezzell Corporation issued perpetual preferred stock with a 9% annual dividend. The stock currently yields 9%, and its par value is $100. a. What is the stock's value? Round your answer to two decimal places. $4 b. Suppose interest rates rise and pull the preferred stock's yield up to 11%. What would be its new market value? Round your answer to two decimal places. 10-5: Constant Growth Stocks Constant growth valuation Thomas Brothers is expected to pay a $2.5 per share dividend at the end of the year (that is, D1 = $2.5). The dividend is expected to grow at a constant rate of 9% a year. The required rate of return on the stock, rs, is 18%. What is the stock's current value per share? Round your answer to two decimal places. $ 10-5: Constant Growth Stocks Valuation of a constant growth stock A stock is expected to pay a dividend of $1.25 the end of the year (that is, D1 = $1.25), and it should continue to grow at a constant rate of 8% a year. If its required return is 15%, what is the stock's expected price 1 years from today? Round your answer to two decimal places. 10-8: Preferred Stock Preferred stock valuation Ezzell Corporation issued perpetual preferred stock with a 9% annual dividend. The stock currently yields 9%, and its par value is $100. a. What is the stock's value? Round your answer to two decimal places. $4 b. Suppose interest rates rise and pull the preferred stock's yield up to 11%. What would be its new market value? Round your answer to two decimal places. 10-5: Constant Growth Stocks Constant growth valuation Thomas Brothers is expected to pay a $2.5 per share dividend at the end of the year (that is, D1 = $2.5). The dividend is expected to grow at a constant rate of 9% a year. The required rate of return on the stock, rs, is 18%. What is the stock's current value per share? Round your answer to two decimal places. $

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