I am at a loss at to how to calculate the stock price. Please help.
The growth rate for McDonalds is expected to be 10% for one year. After that, the dividend rate is expected to grow at a rate of 6% indefinitely. McDonald's shareholders require a rate of return on equity equal to 11%. The last dividend the company paid was $2.20. How do I calculate the current price of the stock?© BrainMass Inc. brainmass.com June 3, 2020, 6:31 pm ad1c9bdddf
ke=cost of equity=11%
Div1= Expected dividend ...
This provides the steps to calculate the stock price