if a construction company is expected to pay the following dividends , and then grow indefinitely at 4.5%(assuming a discount rate of 14.5%) what would it's stock value be ?
To determine the stock value of a company, we can use the Dividend Discount Model (DDM). The DDM assumes that the value of a stock is the present value of all future dividends it is expected to pay.
The formula for the DDM is: Stock Value = Dividend / (Discount Rate - Dividend Growth Rate)
Given the following information:
- Expected dividends: Not provided in the question.
- Growth rate: 4.5%
- Discount rate: 14.5%
To find the stock value, we need to know the expected dividends for the construction company. Please provide the expected dividends, and I can help you calculate its stock value.