The company will pay a 10 per share dividend in 10 years


Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years because the firm needs to plow back its earnings to fuel growth. The company will pay a $10 per share dividend in 10 years and will increase the dividend by 5% year thereafter. If the required an 11% return on the company's stock, how much will you pay for a share today?

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Finance Basics: The company will pay a 10 per share dividend in 10 years
Reference No:- TGS0626307

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