Explore BrainMass

Explore BrainMass

    Stock valuation

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    The Bradshaw Company's most recent dividend was $6.75. The historical dividend payment by the company shows a constant growth rate of 5 percent per year. What is the maximum you would be willing to pay for a share of its common stock if your required rate of return is 8 percent?

    © BrainMass Inc. brainmass.com June 3, 2020, 11:35 pm ad1c9bdddf
    https://brainmass.com/business/finance/bradshaw-company-common-stock-286332

    Solution Preview

    What we would be willing to pay is the present value of dividends. Since the dividends grow ...

    Solution Summary

    The solution explains how to deteremine the value of the stock

    $2.19

    ADVERTISEMENT