CX Enterprises has the following expected dividends $1.09 in one year, $1.23 in two years, and $1.34 in three years. After that, its dividends are expected to grow at 4.3% per year forever (so that year 4's dividend will be 4.3% more than 1.34 and so on). If CX's equity cost of capital is 11.5%, what is the current price of its stock?
CX Enterprises has the following expected dividends $1.09 in one year, $1.23 in two years, and $1.34 in three years. After that, its dividends are expected to grow at 4.3% per year forever (so that year 4's dividend will be 4.3% more than 1.34 and so on). If CX's equity cost of capital is 11.5%, what is the current price of its stock?
Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter7: Corporate Valuation And Stock Valuation
Section: Chapter Questions
Problem 1P: Ogier Incorporated currently has $800 million in sales, which are projected to grow by 10% in Year 1...
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![CX Enterprises has the following expected dividends $1.09 in one year, $1.23 in two years, and $1.34 in three years
After that, its dividends are expected to grow at 4.3% per year forever (so that year 4's dividend will be 4.3% more than
1.34 and so on). If CX's equity cost of capital is 11.5%, what is the current price of its stock?
The price of the stock will be $
(Round to the nearest cent.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F66ede0ce-50e6-4905-bbff-40011e46aa94%2F6fc014c0-e796-40c7-a07b-7f05bda59260%2F0h75vle_processed.jpeg&w=3840&q=75)
Transcribed Image Text:CX Enterprises has the following expected dividends $1.09 in one year, $1.23 in two years, and $1.34 in three years
After that, its dividends are expected to grow at 4.3% per year forever (so that year 4's dividend will be 4.3% more than
1.34 and so on). If CX's equity cost of capital is 11.5%, what is the current price of its stock?
The price of the stock will be $
(Round to the nearest cent.)
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