Finance Assignment | Professional Writing
May 27th, 2020
Assume Highline Company has just paid an annual dividend of $1.06. Analysts are predicting an 11.3% per year growth rate in earnings over the next five years. After then, Highline’s earnings are expected to grow at the current industry average of 5.5% per year.
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If Highline’s equity cost of capital is 9.1% per year and its dividend payout ratio remains constant, for what price does thedividend-discount model predict Highline stock should sell?
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