Problembunge corp earned 775 per share and paid 325 in, Ask an Expert

Finance

Problem:

Bunge Corp. earned $7.75 per share and paid $3.25 in dividends in the year just ended. Bunge's (trailing) P/E ratio is 9.0.

Required:

Question: If Bunge dividends are expected to grow at a 5% rate forever, what is the expected rate of return on Bunge stock?

Note: Provide support for your rationale.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91163471

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