Assume Highline Company has just paid an annual dividend of $0.91. Analysts are predicting an11.8% per year growth rate
Posted: Tue Nov 16, 2021 7:52 am
Assume Highline Company has just paid an annual dividend of
$0.91. Analysts are predicting an11.8% per year growth rate in
earnings over the next five years. After then, Highline's
earnings are expected to grow at the current industry average of
5.6% per year. If Highline's equity cost of capital is
8.6%per year and its dividend payout ratio remains constant,
for what price does the dividend-discount model predict
Highline stock should sell?
$0.91. Analysts are predicting an11.8% per year growth rate in
earnings over the next five years. After then, Highline's
earnings are expected to grow at the current industry average of
5.6% per year. If Highline's equity cost of capital is
8.6%per year and its dividend payout ratio remains constant,
for what price does the dividend-discount model predict
Highline stock should sell?