Cooperton Mining just announced it will cut its dividend from $4.19 to $2.34 per share and use
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Cooperton Mining just announced it will cut its dividend from $4.19 to $2.34 per share and use the extra funds to expand. Prior to the announcement, Cooperton's dividends were expected to grow at a 3.1% rate, and its share price was $48.31. With the planned expansion, Cooperton's dividends are expected to grow at a 4.7% rate. What share price would you expect after theannouncement? (Assume that the new expansion does not changeCooperton's risk.) Is the expansion a goodinvestment?
The new price for Cooperton's stock will be $ ____(Round to the nearest cent.)
Is the expansion a good investment? Yes or no?
Related Book For
Fundamentals Of Corporate Finance
ISBN: 9781292437156
5th Global Edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
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