The next dividend payment by Blue Cheese, Inc., will be $1.92 per share. The div

Question

The next dividend payment by Blue Cheese, Inc., will be $1.92 per share. The dividends are anticipated to maintain a growth rate of 6 percent forever. The stock currently sells for $38 per share.

What is the dividened yield?

what is the expected Cpatial gains yield

The next dividend payment by Blue Cheese, Inc., will be $1.92 per share. The dividends are anticipated to maintain a growth rate of 6 percent forever. The stock currently sells for $38 per share.

What is the dividened yield?

what is the expected Cpatial gains yield

Explanation / Answer

Hi,

Please find the answer as follows:

Dividend Yield = Current Dividend/Price*100 = 1.92/38*100 = 5.05%

Capital Gains Yield is same as Dividend Growth Rate. Therefore it would be 6% only.

Capital Gains Yield = 6%

Thanks.

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