Mavs Inc. wishes to determine its cost of common stock equity, rs. The market price, P0, of its common stock is $44.15 per share. The firm expects to pay a dividend, D1, of $4.20 at the end of the coming year, 2021. The dividends paid on the outstanding stock over the past 6 years (2015–2020) were as follows:
2015 | $3.60 |
2016 | 3.65 |
2017 | 3.70 |
2018 | 3.85 |
2019 | 4.00 |
2020 | 4.10 |
What is the cost of common stock equity financing?
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