Question: 5. Future Corp. is growing quickly. Dividends are expected to grow at a 20 percent rate for the next 3 years, with the growth rate
5. Future Corp. is growing quickly. Dividends are expected to grow at a 20 percent rate for the next 3 years, with the growth rate falling off to a constant 6 percent thereafter. If the required return is 13 percent and the company just paid a $3.05 dividend, what is the current share price? (Hint: Calculate the first four dividends.) P = D. (1+g)/(R-8) Ps= D. (1+gi) (1 + gz)/(R-8)
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