1- Choose 2 firms that interest you and download their financial statements from any of these...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
1- Choose 2 firms that interest you and download their financial statements from any of these Web sites: finance.yahoo.com, finance.google.com, or money.msn.com. a. For each firm, find the return on equity (ROE), the number of shares outstanding, the dividends per share, and the net income. Record them in a spreadsheet (EXCEL). b. Calculate the total amount of dividends paid (Dividends per share x Number of shares outstanding), the dividend payout ratio (Total dividends paid/Net income), and the plowback ratio (1 - Dividend payout ratio). c. Compute the sustainable growth rate, g = b x ROE, where b equals the plowback ratio. 2- Now calculate the intrinsic value of the firms you selected? You can find the required return (k) on each firm based on the CAPM. Make reasonable judgments about the market risk premium and the risk-free rate (you can find them online) Also, You can find the beta of each firm from its Statistics page. 1- Choose 2 firms that interest you and download their financial statements from any of these Web sites: finance.yahoo.com, finance.google.com, or money.msn.com. a. For each firm, find the return on equity (ROE), the number of shares outstanding, the dividends per share, and the net income. Record them in a spreadsheet (EXCEL). b. Calculate the total amount of dividends paid (Dividends per share x Number of shares outstanding), the dividend payout ratio (Total dividends paid/Net income), and the plowback ratio (1 - Dividend payout ratio). c. Compute the sustainable growth rate, g = b x ROE, where b equals the plowback ratio. 2- Now calculate the intrinsic value of the firms you selected? You can find the required return (k) on each firm based on the CAPM. Make reasonable judgments about the market risk premium and the risk-free rate (you can find them online) Also, You can find the beta of each firm from its Statistics page.
Expert Answer:
Answer rating: 100% (QA)
Here is a general outline of the steps you can follow 1 Obtain the financial statements Go to the fi... View the full answer
Related Book For
Posted Date:
Students also viewed these finance questions
-
List three specific parts of the Case Guide, Objectives and Strategy Section (See below) that you had the most difficulty understanding. Describe your current understanding of these parts. Provide...
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
How does HCA's financial strategy affect its product-market strategy? How important is finance to HCA and in what ways? (Please no plagiarism) Hospital Corporation of America (A) In January of 1982...
-
The partnership of King, Queen and Prince engaged you to audit its accounting records. Some accounts are on the accrual basis and others are on the cash basis. The partnership's books were closed at...
-
Light from the Sun takes approximately 8.3 min to reach the Earth. During this time interval the Earth has continued to rotate on its axis. How far is the actual direction of the Sun from its image...
-
At one instant, force F = 4.0j N acts on a 0.25 kg object that has position vector r = (2.0i - 2.0k) m and velocity vector r = (-5.0i + 5.0k) m/s. About the origin and in unit vector notation, what...
-
Stanley Neal and Helen Jobe each have equity of $40,000.00 in an existing partnership. The partners share equally in all changes in equity. On August 1 of the current year, the existing partners...
-
A client of yours is considering investing in a partnership and has been analyzing the financial statements of the partnership. Their analysis has resulted in the following observations that that...
-
A depositor puts $ 3 0 , 0 0 0 in a savings account that pays 4 % interest, compounded quarterly. Equal annual withdrawals are to be made from the account, beginning one year from now and continuing...
-
Javier is a police officer or Javier is a little league coach. If Javier is a police officer, then Javier is a community leader. Javier is a little league coach if and only if Javier is a community...
-
The lost value of equipment over a period of time is called depreciation. The simplest method for calculating depreciation is straight-line depreciation. The annual straight-line depreciation D of an...
-
In MyGuitarShop, SQL query to return the total number of times each product has been ordered. This query lists the product name and number of times it has been ordered. 1) Orders Database: PK is...
-
In a fourth-grade class, 50% of the students are boys. You randomly select a student from this class. What is the probability that the student is a boy?
-
Simplify completely: 82+ 18
-
The percentage of the budget that is mandatory spending is %, which only leaves % for discretionary spending. When people talk about cutting back on federal spending, the only money that can really...
-
After the tangible assets have been adjusted to current market prices, the capital accounts of Brad Paulson and Drew Webster have balances of $52,000 and $73,000, respectively. Austin Neel is to be...
-
Please describe what a Galera cluster is and how it works. In your description, compare a Galera cluster to a Windows server cluster and the strengths and weaknesses of each
-
What are the typical record-at-a-time operations for accessing a file? Which of these depend on the current file record?
-
1. Using the full spectrum of segmentation variables, describe how GM has segmented the automobile market. 2. What segment(s) is Saturn now targeting? How is GM now positioning Saturn? How do these...
-
1. Explain the core, actual, and augmented levels of this service. 2. Does this service have the potential to deliver customer value? Explain your answer. With the magazine industrys circulation and...
-
Many companies are realizing the efficiency of telemarketing in the face of soaring sales force costs. Whereas an average cost of a business-to-business sales call by an outside salesperson costs...
-
When an enterprise's primary reporting objective is cash flow assessment, the enterprise will use a cash basis of reporting rather than an accrual basis.
-
Canadian accounting standards are set by the Canada Business Corporations Act.
-
The debt and equity securities of a private company cannot be traded on public exchanges. Therefore, private companies have no external sources of financing.
![Mobile App Logo](https://dsd5zvtm8ll6.cloudfront.net/includes/images/mobile/finalLogo.png)
Study smarter with the SolutionInn App