Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $8 per share and has announced that it will increase the dividend by $6 per share for each of the next five years, and then never pay another dividend. If you require a return of 11 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price

Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $8 per share and has announced that it will increase the dividend by $6 per share for each of the next five years, and then never pay another dividend. If you require a return of 11 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

Forral Company has never paid a dividend. But the company plans to start paying dividends in two years-that is, at the end of Year 2. The first dividend is expected to equal $1 per share. The second dividend and every dividend thereafter are expected to grow at a 6 percent rate. If Investors require a 14 percent rate of return to purchase Forral's common stock, what should be the market value of its stock today? Do not round intermediate calculations. Round your answer to the nearest cent. $______.
4. Target Inc. has just paid a dividend of $4 per share and has announced that it will increase the dividend by $2 per share for each of the next four years, and then never pay another dividend. If you require an 8% return on the company’s stock, how much will you pay for a share today? (show work)
Chamberlain Corporation is expected to pay the following dividends over the next four years: $13.20, $9.20, $8.20, and $3.70. Afterward, the company pledges to maintain a constant 4% growth rate in dividends forever. If the required return on the stock is 12%, what is the current share price? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
XYZ Inc., has an odd dividend policy. The company has just paid a dividend of $11.00 per share and has announced that it will increase the dividend by $9.00 per share for each of the next four years, and then never pay another dividend. If you require a return of 16 percent on the company’s stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
If you require a return of 12 percent on this stock, what will you pay for a share today?
Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $7 per share and has announced that it will increase the dividend by $6 per share for each of the next five years, and then never pay another dividend. If you require a return of 14 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price
Skyler Industries's preferred stock currently sells for $43 per share. The stock pays an annual dividend of $2.95 per share. The cost of preferred stock, Rp, is ____%. Round your final answer to 2 decimal places (example: enter 12.34 for 12.34%), but do not round any intermediate work in the process. [Note: Correct answer feedback may show more than 2 decimal places, but you should still follow instructions above for entering your answers.]
JJ Industries will pay a regular dividend of $3.10 per share for each of the next four years. At the end of four years, the company will also pay out a liquidating dividend. If the discount rate is 11 percent, and the current share price is $67, what must the liquidating dividend be? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Hank Corp.'s common stock currently sells for $53 per share. The most recent dividend (Do) was $2.48, and the expected growth rate in dividends per year is 7%. The cost of common equity, Re, is ____%. Round your final answer to 2 decimal places (example: enter 12.34 for 12.34%), but do not round any intermediate work in the process.
Shirley and Sons pays no dividend at the present time. The company plans to start paying an annual dividend in the amount of $.30 a share for two years commencing two years from today. After that time, the company plans on paying a constant $1 a share dividend indefinitely. Given a required return of 14% p.a., what is the value of this stock?
Goulds Corp. pays a constant $9.05 dividend on its stock. The company will maintain this dividend for the next 9 years and will then cease paying dividends forever. If the required return on this stock is 10%, what is the current share price? (Do not round intermediate calculations. Round the final answer to 2 decimal places.) Current share price LA
A company follows a dividend policy that raises dividends annually at a rate of 4% (and expects this rate to go forever). The company just paid an annual dividend of $2.11. The required rate of return is 15%. What is today's stock price? For your answer round to the nearest 2 decimals. Do not use the $ sign in your answer. For example, if the answer is $3.237 enter your answer as 3.24; Do not enter it as $3.237, $3.2, 3.2, or 3.237

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