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Business, 05.05.2020 08:23 ryleerose255

Suppose your uncle would like to purchase some shares of HotPick Inc. common stock. Because you’ve had a course in finance, he has asked you to evaluate the stock price. According to your research, HotPick expects its next dividend to be $5.20 (D1). The expected growth rate in the stock price and dividends is 4%, and a total return of 16% is required, given the risk. How much should your uncle be willing to pay for a share of HotPick common stock today? (Use the Dividend Growth Model).

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