Question

Upper Gullies Corp. just paid a dividend of $2.70 per share. The
dividends are expected to grow at 19 percent for the next eight
years and then level off to a 7 percent growth rate indefinitely.
If the required return is 14 percent, what is the price of the
stock today? **(Do not round intermediate calculations. Round
the final answer to 2 decimal places.)**

Stock price | $ |

Answer #1

Price of stock today= Present value of all the dividend till 8th year+ Present value divident from 9th year till perpetuity

Present value of all the dividend till 8th year= (2.70*(1.19))/1.14+(2.70*(1.19^2))/1.14^2+(2.70*(1.19)^3)/1.14^3+(2.70*(1.19)^4)/1.14^4+(2.70*(1.19)^5)/1.14^5+(2.70*(1.19)^6)/1.14^6+(2.70*(1.19)^7)/1.14^7+(2.70*(1.19)^8)/1.14^8

= $26.33

Present value divident from 9th year till perpetuity= (((2.70*(1.19)^8)*1.07)/0.14-0.07)/1.14^8 =$58.18

Price of the stock today = $84.51

A7X Corp. just paid a dividend of $1.55 per share. The
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and then level off to a growth rate of 8 percent indefinitely.
If the required return is 14 percent, what is the price of the
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Thirsty Cactus Corp. just paid a dividend of $1.20 per share.
The dividends are expected to grow at 25 percent for the next 9
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Required : If the required return is 14 percent, what is the price
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A7X Corp. just paid a dividend of $1.32 per share. The dividends
are expected to grow at 12 percent for the next eight years and
then level off to a growth rate of 2.5 percent indefinitely. If the
required return is 8 percent, what is the price of the stock
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D. $45.39
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If the required
return is 15 percent, what is the price of the stock today?

Could I Industries just paid a dividend of $1.30 per share. The
dividends are expected to grow at a rate of 15 percent for the next
five years and then level off to a growth rate of 6 percent
indefinitely. If the required return is 12 percent, what is the
value of the stock today? (Do not round intermediate calculations.
Round your answer to 2 decimal places.) Price:

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dividends are expected to grow at a rate of 18 percent for the next
six years and then level off to a growth rate of 7 percent
indefinitely. If the required return is 15 percent, what is the
value of the stock today? (Do not round intermediate calculations.
Round your answer to 2 decimal places.)

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ZZZ Industries just paid a dividend of $1.35 per share. The
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****show step****

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