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EngineeringPro
Course
FIN3403
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0
Subject
Finance
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Question

Stock in Country Road Industries has a beta of 1.01. The market risk premium is 9 percent, and T-bills are currently yielding 5.5 percent. The company's most recent dividend was $1.6 per share, and dividends are expected to grow at a 7.5 percent annual rate indefinitely. If the stock sells for $34 per share, what is your best estimate of the company's cost of equity?

12.56%
13.57%
14.59%
11%
9.03%

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