Purchase Solution

Stock Price

Not what you're looking for?

Ask Custom Question

CK's earnings and dividends will grow at .5% monthly for the next 5 years. After that the growth will stop. For year 6 and afterward, it will pay out all earnings as dividends. Next years EPS is $10 and the dividends is $5 and the market capitalizes rate is 9%. How can I determine what CK's stock price is?

Purchase this Solution
Solution Summary

The solution explains the calculation of stock price using the dividend discount model.

Purchase this Solution
Free BrainMass Quizzes
Organizational Behavior (OB)

The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.

Situational Leadership

This quiz will help you better understand Situational Leadership and its theories.

Basics of corporate finance

These questions will test you on your knowledge of finance.

Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

View More Free Quizzes
Related BrainMass Solutions

  • Stock Price After Options are Exercised

    183927 Stock Price After Options are Exercised Yert Corporation issues 100 stock options to its CEO on January 1, 2005. The stock options have an exercise price of $50 and the current stock price is $50 at the grant date.

  • Warrants

    b) If the stock price is above the exercise price of the warrant, the lower bound on the price of the warrant is the difference between the stock price and the exercise price.

  • Return on Preferred Stock

    dividend yield of this stock Dividend yield= Dividend/ Current price= 12% =8/66.67 Answer: Dividend yield= 12% capital gains yield of this stock Capital gains yield=Change in stock price/Current stock price Since the price of

  • Preferred Stock calculations

    Capital gains yield=Change in stock price/Current stock price Since the price of the stock does not change the capital gains yield= 0%=0/66.67 Answer: capital gains yield=0% e. What is the expected rate of return of this stock?

  • Valuation of Preferred Stock - Current and original Value

    Preference stock formula is Yield = Fixed Dividend / Price of Preferred Stock What was the original issue price? 6% = $6 / Price So we get original issue price = $6/6%=$100 What is the current value of this preferred stock?

  • Variables Affecting Option Price

    A call option gives the holder the right to purchase the stock at a lower price (Exercise price) than the current stock price. The higher the stock price, the higher is the call value.

  • Stock Splits and Stock Dividends for Roll Corporation

    (b) Share price after 15% stock dividend = 78/(1+15%) = 78/1.15 = $67.83 (c) Share price after 42.5% stock dividend = 78/(1+42.5%) = 78/1.425 = $54.74 (d) Reverse stock split share price = 78*7/4 = $136.50 The solution computes share price under

  • Preferred stock- price, dividend yield, capital gains yield

    Capital gains yield=Change in stock price/Current stock price Since the price of the stock does not change the capital gains yield= 0% =0/66.67 Answer: capital gains yield= 0% e.

  • The answer to preferred stock

    3.If the yield on the Standard & Poor's Preferred Stock Index declines how will the price of the preferred stock be affected? 1. What was the original issue price?

  • Preferred Stock Value

    If the yield on the Standard & Poor's Preferred Stock Index declines, how will the price of the preferred stock be affected? What was the original issue price?

View More Related Solutions