A preferred stock from ABC pays $3.55 in annual dividends. If the required return on the preferred stock is 6.7%, what is the value of the stock?

Question

asked Jul 13, 2022 204k views

1 Answer

Eugene Stepanenkov · Answer 1 · 2022-07-17T08:06:27+0000

Answer:

The value of the stock is $52.99 or $53.

Explanation:

Annual dividend per share

Cost of preferred stock

=

$

3.55

6.7

%

=

$

52.99

hope this helps :)