Part-time Student Co. pays a $2 dividend and expects to continue to pay this amount for the foreseeable future. If the required return for this stock is 5% what should the price of it be? 

 ZXC Co. has never paid a dividend. A stock analyst predicts it will pay a $2.00 per share dividend in one year, a $3.50 dividend in 2 years and a $5.00 dividend in 3 years, then increase the dividend by 5% from year 4 forward. 

Using the non- constant growth model what would the price of the stock be today?

Answer rating: 100% (QA)

To calculate the price of the stock for Parttime Student Co we can use the Gordon Growth Model also ... View the full answer