Heard, Inc., just paid a dividend of $1.75 per share on its stock.
Heard, Inc., just paid a dividend of $1.75 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year, in- (Questions 1–8) definitely. If investors require a 12 percent return on Heard stock, what is the current price? What will the price be in three years? In 15 years?
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Get Help Now!The next dividend payment by SAF, Inc., will be $2.50 per share. The dividends are anticipated to maintain a 5 percent growth rate, forever. If SAF stock currently sells for $48.00 per share, what is the required return?
For the company in the previous problem, what is the dividend yield? What is the expected capital gains yield?
Cannone Corporation will pay a $4.00 per share dividend next year. The company pledges to increase its dividend by 4 percent per year, indef-initely. If you require a 13 percent return on your investment, how much will you pay for the company’s stock today?
Shocking Co. is expected to maintain a constant 7 percent growth rate in its dividends, indefinitely. If the company has a dividend yield of 4.2 percent, what is the required return on the power company’s stock?
Suppose you know that a company’s stock currently sells for $60 per share and the required return on the stock is 14 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield. If it’s the company’s policy to always maintain a constant growth rate in its dividends, what is the current dividend per share?
Kiessling Corp. pays a constant $9 dividend on its stock. The company will maintain this dividend for the next eight years and will then cease paying dividends forever. If the required return on this stock is 11 percent, what
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