The earnings, dividends, and common stock price of Carpetto Technologies Inc. are expected to grow at 7 percent per year in the future. Carpetto's common stock sells for $23 per share, its last dividend was $2.00, and it will pay a dividend of $2.14 at the end of the current year. Assuming you have equal confidence in the outputs used for the three approaches, what is your estimate of Carpetto's cost of common equity?© BrainMass Inc. brainmass.com June 3, 2020, 10:07 pm ad1c9bdddf
What is your estimate of Carpetto's cost of common equity?
Cost= Estimated dividend/Price +Growth rate
This provides the steps to calculate the Carpetto's cost of common equity