+- Accountancy Forum (https://www.accountancy.com.pk/forum)
+-- Forum: The Profession (https://www.accountancy.com.pk/forum/forumdisplay.php?fid=4)
+--- Forum: Students (https://www.accountancy.com.pk/forum/forumdisplay.php?fid=13)
+--- Thread: common stock valuation (/showthread.php?tid=8230)
common stock valuation - samileo31 - 06-23-2010
ABC Co. just paid a dividend of Rs.7.50 per share. The company will increase its dividend by 15% next year, and then will reduce this dividend growth rate by 5% annually until it reaches the industry average of 5 percent, after which the company will keep a constant growth rate forever. If the required return on ABC stock is 14.50 percent, what will be a share of stock sell for today?