1. Theta Analytics is currently traded at $24.04 per share. Theta anticipates paying a cash dividend of $4.53 at the end of the year, with that amount growing at 2.8 percent per year forever after. What is the cost of equity capital in percent?
2. If Basalt Hardware plans to pay an annual dividend of 1.9 a share at the end of this year, expects to pay dividends forever and expects to increase the dividend by 5.9 percent annually. Stocks similar to Basalt Hardware have an expected return of 12.4 percent. What is the current value of this stock?
3. Obsidian Industries just paid a dividend of $1.23 per share. The dividends are expected to grow at a 22 percent rate for the next 4 years and then level off to a 4 percent growth rate indefinitely. If the required return is 14.7 percent, what is the value of the stock today?
4. If Granite Mercantile just paid an annual dividend of $2.5 a share, expects to pay dividends forever and expects to increase the dividend by 3 percent annually. Stocks similar to Granite Mercantile have an expected return of 11.3 percent. What is the current value of this stock?
5. Marble Trading plans to pay an annual dividend of $3.1 this year, and the stock currently sells for $85 per share. If the discount rate is 10.62 percent, what is the dividend growth rate in percent?
6. If Igneous Proprietary just paid an annual dividend of $3.36 a share, expects dividends will grow 13.4 percent a year for the next 7 years and expects to increase the dividend by 4.6 percent annually forever thereafter. The required return is 9 percent. What is the price of this stock?