Kay Jay, Inc. is expected to pay its first ever annual dividend one year from now, based on an expected earnings per share of $2.50 and a payout ratio of 40%. Future earnings per share are expected to grow indefinitely at 4% per year, and Kay Jay is expected to maintain the 40% payout ratio. If Kay Jay’s cost of equity capital is 15%, at what price should Kay Jay’s stock to sell for today?
Unemployed-professor.com is a unique service that provides guidance with different types of content. Please rest assured that the service is absolutely legal and doesn’t violate any regulations.
First time here? Give it a try and get 15% OFF your first order! Order Now