Wheel Source stock has an expected annual return of 17.40 percent. The stock is expected to be priced at $70.26 per share in 1 year and the stock currentlyhas an expected dividend yield of 4.75 percent. What is the current price of the stock?O $62.37 (plus or minus 10 cents)O $59.85 (plus or minus 10 cents)O $82.49 (plus or minus 10 cents)O $67.07 (plus or minus 10 cents)O none of the answers are within 10 cents of the correct answer

The following information has been provided,Expected stock price in year 1 = $70.26Expected annual…

Answered: Wheel Source stock has an expected…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 10P

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Similar questions

A stock is trading at $80 per share. The stock is expected to have a yearend dividend of $4 per share (D1 = $4), and it is expected to grow at some constant rate, g, throughout time. The stock’s required rate of return is 14% (assume the market is in equilibrium with the required return equal to the expected return). What is your forecast of gL?
Crisp Cookware’s common stock is expected to pay a dividend of $3 a share at the end of this year (D1 = $3.00); its beta is 0.8. The risk-free rate is 5.2%, and the market risk premium is 6%. The dividend is expected to grow at some constant rate g, and the stock currently sells for $40 a share. Assuming the market is in equilibrium, what does the market believe will be the stock’s price at the end of 3 years (i.e., what is )?
ABC common stock is expected to pay a dividend of $3 a share at the end of the year; the required rate of return is 10%. The dividend is expected to grow at some constant rate g, and the stock currently sells for $100 a share. Assuming the market is in equilibrium, the stock's price at the end of year 5 will be $_______. $60.83 $140.26 $54.12 $115.43
Village Goofball stock is currently priced at $71.95 per share and is expected to pay its next dividend, which is expected to be $7.32, in 1 year. The stock has a risk premium of 10.18%, the risk-free rate is 4.91%, and inflation is expected to be 2.92%. What is the stock price of Village Goofball expected to be in 1 year? O $80.71 (plus or minus 10 cents) $82.81 (plus or minus 10 cents) $75.49 (plus or minus 10 cents) $81.38 (plus or minus 10 cents) None of the above is within 10 cents of the correct answer
A preferred stock is expected to pay a constant quarterly dividend of $1.75 per quarter into the future. The required rate of return, Rs, on the preferred stock is 12.0 percent. What is the fair value (or price) of this stock? Group of answer choices a. $18.65 b. None of the above c. $37.04 d. $24.36 e. $58.33
The dividend of a stock is expected to be $3.3/share in this period. The current price of the stock is $66.2/share. Its price is expected to be $69.8/share at the end of the period. The expected return rate of the stock in this period is %. (Hints/Example]
A stock will pay a dividend of $1.1 and is expected to be worth $55.7 in 1 year. If the stock is currently selling for $45.3, what is the return? Answer as a percent. Answer:

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