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NEW QUESTION: 1
A. Option D
B. Option B
C. Option C
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Answer: C
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A portfolio manager is currently evaluating one of the stocks in the portfolio by looking at the following data:
Current dividend per share: $0.75 Current earnings per share: $1.82 Total NO. of shares outstanding: 22 million Book value of common Equity: $350 million
In particular, what is the best estimate of this particular company's dividend growth rate?
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C. 6.7%
Answer: C
Explanation:
Sustainable Growth Rate = ROE ( 1 - Dividend Payout Ratio) = [($1.82 x 22M)/$350M] [1 -
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