What is Carla’s current stock price?

Question 39

Carla Tire’s current dividend is $5.30. Dividends are expected to grow by 20 percent for years 1 to 3 and 10 percent thereafter. The required rate of return on the stock is 13 percent. What is Carla’s current stock price? (Round intermediate calculations to 4 decimal places, e.g. 7.1285 and final answer to 2 decimal places, e.g. 115.61.)

Question 34

Bridgeport Supplies Ltd. currently doesn’t pay any dividends but is expected to start paying dividends in five years. The first dividend is expected to be $1 and is expected to grow at 4.5 percent thereafter. The required rate of return for the firm is 9 percent. What is Bridgeport’s current stock price? (Round intermediate calculations to 3 decimal places, e.g. 20.417 and the final answer to 2 decimal places, e.g. 15.61.)

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Question 35

Coronado Corporation has issued $1 million in preferred shares to investors with a 6.95 percent annual dividend rate on a par value of $100. Assuming the firm pays dividends indefinitely and the required rate is 9.5 percent, calculate the price of the preferred shares. (Round answer to 2 decimal places, e.g. 15.61.)

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