XYZ common stock recently paid annual dividend in the amount of $1.75 per share. The analysts estimate of the firm’s growth forecast over the next 5 years is 15%. You expect the firm to slow down in the long run and estimate the long-term growth rate after 5 years to be 8%. If the required rate of return on the stock is 10%, what is your estimate of the stock price? Solve using Excel
XYZ common stock recently paid annual dividend in the amount of $1.75 per share. The analysts estimate of the firm’s growth forecast over the next 5 years is 15%. You expect the firm to slow down in the long run and estimate the long-term growth rate after 5 years to be 8%. If the required rate of return on the stock is 10%, what is your estimate of the stock price? Solve using Excel
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
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- XYZ common stock recently paid annual dividend in the amount of $1.75 per share. The analysts estimate of the firm’s growth
forecast over the next 5 years is 15%. You expect the firm to slow down in the long run and estimate the long-term growth rate after 5 years to be 8%. If the requiredrate of return on the stock is 10%, what is your estimate of the stock price? Solve using Excel
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