Question

Weston Corporation just paid a dividend of $1.25 a share (i.e., D0 = $1.25). The dividend...

Weston Corporation just paid a dividend of $1.25 a share (i.e., D0 = $1.25). The dividend is expected to grow 12% a year for the next 3 years and then at 3% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places.

D1=

D2=

D3=

D4=

D5=

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
D1=$1.40
D2=$1.57
D3=$1.76
D4=$1.81
D5=$1.86
Working Notes:
D1 = D0 x (1+g) = $1.25 x (1+0.12) =$1.40
D2 = D1 x (1+g) = $1.40 x (1+0.12) =$1.568 = $1.57
D3 = D2 x (1+g) = $1.568 x (1+0.12) =$1.75616 = $1.76
D4 = D3 x (1+g) = $1.75616 x (1+0.03) =$1.8088448 = $1.81
D5 = D4 x (1+g) = $1.8088448 x (1+0.03) =$1.863110 = $1.86
Please feel free to ask if anything about above solution in comment section of the question.
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Weston Corporation just paid a dividend of $3.75 a share (i.e., D0 = $3.75). The dividend...
Weston Corporation just paid a dividend of $3.75 a share (i.e., D0 = $3.75). The dividend is expected to grow 8% a year for the next 3 years and then at 3% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places. d1= d2= d3= d4= d5=
DPS CALCULATION Weston Corporation just paid a dividend of $1.5 a share (i.e., D0 = $1.5)....
DPS CALCULATION Weston Corporation just paid a dividend of $1.5 a share (i.e., D0 = $1.5). The dividend is expected to grow 10% a year for the next 3 years and then at 5% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places. D1 = $ D2 = $ D3 = $ D4 = $ D5 = $
-Weston Corporation just paid a dividend of $3.25 a share (i.e., D0 = $3.25). The dividend...
-Weston Corporation just paid a dividend of $3.25 a share (i.e., D0 = $3.25). The dividend is expected to grow 12% a year for the next 3 years and then at 5% a year thereafter. What is the expected dividend per share for each of the next 5 years? D1 , D2, D3, D4, D5 - Tresnan Brothers is expected to pay a $1.70 per share dividend at the end of the year (i.e., D1 = $1.70). The dividend is...
FIA Industries just paid a dividend of $ 1.5 a share (i.e., D0 = 1.5 )....
FIA Industries just paid a dividend of $ 1.5 a share (i.e., D0 = 1.5 ). The dividend is expected to grow 10 % a year for the next 3 years and then at 4 % a year thereafter. What is the expected dividend per share for year 6 (i.e., D 6 )? Round your answers to two decimal places. Boehm Incorporated is expected to pay a $ 1.5 per share dividend at the end of the year (i.e.,D1). The...
Mack Industries just paid $1.00 per share dividend (i.e., D0=$1.00). Analysts expect the company's dividend to...
Mack Industries just paid $1.00 per share dividend (i.e., D0=$1.00). Analysts expect the company's dividend to grow 20 percent this year (i.e., D1=1$1.20), and 15 percent in the following year. After two years the dividend is expected to grow at a constant rate of 5 percent. The required rate of return on the company's stock is 12 percent. What should be the current price of the company's stock? Show answer using excel.
Ashworth Corp has just paid its annual dividend of $10.00. The company has announced an aggressive...
Ashworth Corp has just paid its annual dividend of $10.00. The company has announced an aggressive expansion plan. The plan requires investment for the next three years. The company decides to fund the three years of expansion by not paying a dividend for three years. The company will resume paying dividends in year 4 with a dividend of $12.00 per share. After this, the company will grow its dividends at a rate of 8.0% thereafter {D1 = D2 = D3...
Holtzman Clothiers's stock currently sells for $27.00 a share. It just paid a dividend of $1.25...
Holtzman Clothiers's stock currently sells for $27.00 a share. It just paid a dividend of $1.25 a share (i.e., D0 = $1.25). The dividend is expected to grow at a constant rate of 7% a year. What stock price is expected 1 year from now? Round your answer to the nearest cent. $   What is the required rate of return? Do not round intermediate calculations. Round your answer to two decimal places.   %
Hunter Petroleum Corporation paid a $2 dividend last year. The dividend is expected to grow at...
Hunter Petroleum Corporation paid a $2 dividend last year. The dividend is expected to grow at a constant rate of 5 percent forever. The required rate of return is 12 percent (this will also serve as the discount rate in this problem). (Use a Financial calculator to arrive at the answers.) a. Compute the anticipated value of the dividends for the next three years. (Do not round intermediate calculations. Round the final answer to 3 decimal places.) Anticipated value   D1...
Martin Office Supplies paid a $3 dividend last year. The dividend is expected to grow at...
Martin Office Supplies paid a $3 dividend last year. The dividend is expected to grow at a constant rate of 5 percent over the next four years. The required rate of return is 14 percent (this will also serve as the discount rate in this problem). Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. a. Compute the anticipated value of the dividends for the next four years. (Do not...
Gonzo Growth Corporation has never paid a dividend, and will not pay one in the next...
Gonzo Growth Corporation has never paid a dividend, and will not pay one in the next year. However, in exactly two years, it plans to begin paying a dividend equal to 40% of its earnings at that time (i.e, the earnings at the end of year 2). Gonzo’s earnings are expected to be $12.00 per share in the coming year, and it expects earnings to grow by 20% over the following year until the dividend is paid (i.e., from years...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT