Human's Inc.'s last dividend (D0) was $1.12, and its earnings and dividends are expected to increase...
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Human's Inc.'s last dividend (D0) was $1.12, and its earnings and dividends are expected to increase at a constant growth rate of 12%. Humana's market beta is 1.16. If the current risk-free rate is 5% and the required rate of return on the market portfolio is 12%, what is the company's current expected stock price? Hint-round up to the nearest whole dollar. Human's Inc.'s last dividend (D0) was $1.12, and its earnings and dividends are expected to increase at a constant growth rate of 12%. Humana's market beta is 1.16. If the current risk-free rate is 5% and the required rate of return on the market portfolio is 12%, what is the company's current expected stock price? Hint-round up to the nearest whole dollar.
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Answer rating: 100% (QA)
SOLUTION We can use the constant growth dividend discount model to calculate the expected stock pric... View the full answer
Related Book For
Corporate Finance A Focused Approach
ISBN: 978-1305637108
6th edition
Authors: Michael C. Ehrhardt, Eugene F. Brigham
Posted Date:
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