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duck0131
Aug 1, 2014, 05:07 PM
I want to know how to calculate a stock's expected price 3 years from today, whereas stock selling for $35.50 per share, dividend rate of 5.50% per year and the required rate of return on stock is 9.00%. Can you help me?

ebaines
Aug 2, 2014, 06:01 AM
If your required rate of return is 9%, and dividends pay 5.5%, the other 3.5% would have to come from capital appreciation. Do you know how to calculate the future value in 3 years at 3.5% interest?