A firm is expected to pay a cash dividend of $1.10 one year from now, $2.20 two years from now, and $4.40 three years from now. Also, the market price of their common stock is expected to be $73 immediately following the dividend payment three years from now. What is the approximate current market value of this firm's common stock when the required rate of return is 18%?© BrainMass Inc. brainmass.com June 3, 2020, 4:50 pm ad1c9bdddf
Cash dividend of: 1.10 in one year, PV = 1.10/(1+0.18) = 0.9322
In just six lines of calculations, the posting is answered with ease.