Find the current price of CSX cargo's stock. If CSX is expected to pay a constant $1.1

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Find the current price of CSX cargo's stock.

If CSX is expected to pay a constant $1.1 dividend each quarter for the next 7 years the next dividend payment will occur in exactly one quarter from today. In 7 years, analysts forecast an expected price on CSX of $59.96.

The expected annualized return (not a holding period return) on CSX stock is 10.48%. (hint: draw the cashflows - does this pattern look familiar

Related Book For answer-question

Corporate Finance Core Principles and Applications

ISBN: 978-1259289903

5th edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan

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Posted Date: Jun 10, 2023 06:31 AM

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Find the current price of CSX cargo's stock. If CSX is expected to pay a constant $1.1

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Expert Answer:

To find the current price of CSX cargos stock we can use the dividend discount model DDM and the con... View the full answer

Corporate Finance Core Principles and Applications

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