Company zrsquos earnings and dividends per share are


Company Z’s earnings and dividends per share are expected to grow indefinitely by 5% a year. If next year’s dividend is $10 and the market capitalization rate is 8%, what is the current stock price? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Company Z-prime’s earnings and dividends per share are expected to grow by 5% a year. Its growth will stop after year 4. In year 5 and afterward, it will pay out all earnings as dividends. Assume next year’s dividend is $10, the market capitalization rate is 8% and next year’s EPS is $15. What is Z-prime’s stock price? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

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Financial Management: Company zrsquos earnings and dividends per share are
Reference No:- TGS01404350

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