15. Suppose that Skecher's stock paid a dividend of $0.80 last year, and the divided is expected to grow by a constant rate of 6% per year. Skecher's beta is 1.24, the current risk-free rate is 2% and the market risk premium is 7%. What is the intrinsic value (current price) of this stock?
15. Suppose that Skecher's stock paid a dividend of $0.80 last year, and the divided is expected to grow by a constant rate of 6% per year. Skecher's beta is 1.24, the current risk-free rate is 2% and the market risk premium is 7%. What is the intrinsic value (current price) of this stock?
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter8: Basic Stock Valuation
Section: Chapter Questions
Problem 3P
Related questions
Question
![15. Suppose that Skecher's stock paid a dividend of $0.80 last year, and the divided is
expected to grow by a constant rate of 6% per year. Skecher's beta is 1.24, the current
risk-free rate is 2% and the market risk premium is 7%. What is the intrinsic value
(current price) of this stock?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd370752c-61b4-428c-887b-a5634b6cb633%2Fe1dc1dac-edb5-4c10-a7c6-bc1ce372780a%2Fy3yba7_processed.jpeg&w=3840&q=75)
Transcribed Image Text:15. Suppose that Skecher's stock paid a dividend of $0.80 last year, and the divided is
expected to grow by a constant rate of 6% per year. Skecher's beta is 1.24, the current
risk-free rate is 2% and the market risk premium is 7%. What is the intrinsic value
(current price) of this stock?
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