# Finance

posted by .

Saturated Meat Corporation preferred stock is currently selling for \$22 per share. The preferred dividend is \$2.50 per share. If Jennifer requires a return of 10% on the preferred stock, should she invest in this stock?

• Finance -

10% of 22 = 2.2

What do you think?

• Finance -

I think not but why?

• Finance -

She should buy this stock. The yearly dividend is \$2.50. That is more than 10% of the investment.

## Similar Questions

1. ### Corporate Finance

Taylor Inc. has preferred perpetual stock outstanding that has a par value of \$100 per share and a dividend yield of 9.4% of stated value. If the appropriate interest rate for Taylorâ€™s preferred stock is 8.3%, how much is each share …
2. ### Finance

Assume AirJet Best Parts has also a preferred stock issue. The most recent dividend per share paid on the stock was also \$1.50, the same as the common stock. Which one would you think has a higher price, the preferred stock or the …
3. ### Finance

Saturated Meat Corporation preferred stock is currently selling for \$22 per share. The preferred dividend is \$2.50 per share. If Jennifer requires a return of 10% on the preferred stock, should she invest in this stock?
4. ### math

NVM's preferred stock currently has a market price equal to \$80 per share. If the dividend paid on this stock is \$6 per share, what is the required rate of return investors would get from NVM preferred stock?

A share of perpetual preferred stock pays an annual dividend of \$6 per share. If the investors require a 12% rate of return, what should be the price of this preferred stock?
6. ### umdnj

A company has preferred stock that can be sold for \$21 per share. The preferred stock pays an annual dividend of 3.5% based on a par value of \$100. Flotation costs associated with the sale of preferred stock equal \$1.25 per share. …
7. ### Finance

1.BAC is considering an issue of preferred stock. The dividends are 8.12% of the \$25 par value. a.If the current price is \$26.25 per share, what is the return on the preferred stock?
8. ### math

mary has outstanding preferred stock That pays a dividend of \$4 per share and sells for \$82 per share, with a floatation cost of \$6 per share. What is the component cost for Coogly's preferred stock?
9. ### finance

National Health Corporation (NHC) has a cumulative preferred stock issue outstanding, which has a stated annual dividend of \$8 per share. The company has been losing money and has not paid preferred dividends for 5 years. There are …
10. ### corporate finance

National Health Corporation (NHC) has a cumulative preferred stock issue outstanding, which has a stated annual dividend of \$9 per share. The company has been losing money and has not paid preferred dividends for the last five years. …

More Similar Questions