StartUp Corporation has just paid a dividend of $1.15 per share. The firm pays annual dividends. It is expected by analysts that the earnings of StartUp will grow by 8.2% per year over next six years. After that, the earnings will most likely grow at the current industry average of 5.5% per year. Analysts do not expect any changes in the payout ratio of the firm. The cost of capital is 10.0%.

What is StartUp’s share price?

Answer rating: 100% (QA)

To calculate the share price of StartUp Corporation we can use the Dividend Discount Model DDM DDM i... View the full answer