Homework answers / question archive / Suppose Facebook Inc

Suppose Facebook Inc

Finance

Share With

Suppose Facebook Inc. does not currently pay a dividend. Analysts project that they will begin paying dividends in 5 years. The first annual dividend will be $5 and then the dividend is predicted to grow at 5% per year. Investors require a 10% rate of return. What is the value of one share of Facebook stock under these assumptions?