Business
Business, 12.12.2019 02:31, harleypage308

Amid the frenzy surrounding pokemon go, nintendo stock soared during mid-july 2016 reaching a high of $38.25 on july 18. on july 24, 2016, nintendo announced that it expected earnings per share to be $0.36 over the following year. as a result, analysts estimated the dividend per share to be $0.21 next year. we can estimate the expected return on nintendo stock using an asset pricing model such as the capm. suppose that the risk-free rate is 2.4% and that the expected return on the market is 6.4%.
using the discount rate calculated in part (a), calculate the value of a share of nintendo stock if it pays a dividend of $0.21 per share (each year) forever. (round your answer to nearest cents. for example, if your answer is $42.231, write 42.32.)

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