Notice that both approaches yield the same price in five years. 7.2 The dividend yield is the next dividend., D, divided by the curent price. Pe or $1/40 = 2.5%. The capital gains yield is the same as the dividend growth rate, 12 percent. The total required return is the sum of the two, 2.5% + 12%-14.5%. CRITICAL THINKING AND CONCEPTS REVIEW 71. Stock Valuation. dividends? Why does the value of a share of stock depend on LO 1 LO1 7.2. Stock Valuation. A substantial percentage of the companies listed on the NYSE and the NASDAQ don't pay dividends, but investors are nonetheless willing to buy shares in them. How is this possible given your answer to the previous