Question

Symon's Suppers Co. has announced that it will pay a dividend of $4.19 per share one year from today. Additionally, the company expects to increase its dividend by 4.2 percent annually. The required return on the company's stock is 10.4 percent. What is the current share price?

Answer 1

$67.6

Step-by-step explanation:

MV=D1/(Ke-g)

D1=4.19

g=4.2%

Ke=10.4%

MV=4.19/(10.4%-4.2%)

MV=$67.6