Which is also expected return on new investment its


Laurel Enterprises expects this year's earnings to be $3.81 per share and has a 50% retention rate, which it plans to keep constant. Its equity cost of capital is 11%, which is also expected return on new investment. Its earnings are expected to grow forever at a rate of 5.5% per year. If its next dividend is due in one year, what do you estimate the firms current stock price to be?

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Finance Basics: Which is also expected return on new investment its
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