Problemameritech corporation paid dividends per share, Ask an Expert

Finance

Problem:

Ameritech Corporation paid dividends per share of $3.56 in 1992, and dividends are expected to grow 5.5% a year forever. The stock has a beta of 0.90, and the Treasury bond rate is 6.25%. (Risk premium is 5.5 %.)

Required:

Question: What is the value per share, using the stable growth model?

Note: Provide support for your rationale.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91162549

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