Discuss the relationship among the various returns that you


Consider four different stocks, all of which have a required return of 19% and a most recent dividend of $4.50 per share. Stocks W, X, and Y are expected to maintain constant growth rates in dividends for the foreseeable future of 10%, 0%, and -5% per year, respectively. Stock Z is a growth stock that will increase its dividend by 20% for the next two years and then maintain a constant 12% growth rate thereafter. What is the dividend yield for each of these four stocks? Discuss the relationship among the various returns that you find for each of these stocks.

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Finance Basics: Discuss the relationship among the various returns that you
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