Synovec Company is growing quickly. Dividends are expected to grow at a rate of 24 percent for the next three years, with the growth rate falling off to a constant 5 percent thereafter. If the required return is 12 percent and the company just paid a dividend of $3.85, what is the current share price? (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
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Ee 484.Please check answer. $5.35 is incorrect

Synovec Company is growing quickly. Dividends are expected to grow at a rate of 24
percent for the next three years, with the growth rate falling off to a constant 5 percent
thereafter. If the required return is 12 percent and the company just paid a dividend
of $3.85, what is the current share price? (Do not round intermediate calculations and
round your answer to 2 decimal places, e.g., 32.16.)
Current share price
Transcribed Image Text:Synovec Company is growing quickly. Dividends are expected to grow at a rate of 24 percent for the next three years, with the growth rate falling off to a constant 5 percent thereafter. If the required return is 12 percent and the company just paid a dividend of $3.85, what is the current share price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price
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