A company's current price is $90.23. Its current dividend is $6.50 a share. Its beta is 1.2

Fantastic news! We've Found the answer you've been seeking!

Question:

A company's current price is $90.23. Its current dividend is $6.50 a share. Its beta is 1.2 and its growth rate is 11%. What is this stock's intrinsic value? Is it over or under valued?

Risk-free rate = 0.016 Market rate = 0.136

Related Book For answer-question

Financial management theory and practice

ISBN: 978-1439078099

13th edition

Authors: Eugene F. Brigham and Michael C. Ehrhardt

See More Books

Posted Date: Apr 16, 2024 06:16 AM

See More Questions

Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
This assignment requires you to complete the 2022 tax reporting for a fictional woman named Anna Smith. Question 1 T1 - step 4 - line 66 This is Anna's taxable income Answer: Question 2 T1 - step...
1 What are the main components of personal financial planning? Solve What is the purpose of a financial plan? Solve Identify some common actions taken to achieve financial goals. How does a job...
A W. Hopes year ended on 30 June 2011. Write up the ledger accounts, showing the transfers to the financial statements and the balances carried down to the next year for the following: (a)...
In Exercises 1-3, determine by inspection (i.e., without performing any calculations) whether a linear system with the given augmented matrix has a unique solution, infinitely many solutions, or no...
Using one of the three traditional theories of normative ethics (teleological, deontological and virtue ethics) what is best when considering the contemporary social issue of Inflation? Why and why...
Where is the place of UML in the process of software development?
After Jack purchases his phone and data plan, is it likely that he experienced cognitive dissonance with his purchase? What evidence makes you answer the way you did?
In what ways does the integration of cutting-edge technology enhance the efficacy of collaborative efforts across global networks ?
Proposed Business Analytical solution for AIR ASIA Discuss the business transformation scope The Business Intelligence architecture Business Intelligence Architecture Diagram and description Business...
Develop the appropriate primary research question to be associated with this design. Develop a hypothetical research scenario that would necessitate the use of a Pretest and Posttest Control Group...
Identify the research scenario, including the relevant variable(s). Develop a hypothetical research scenario that would necessitate the use of a Longitudinal Design. The research will be considered...
Discuss the sampling strategy and technique used to access the appropriate sample. Develop a hypothetical research scenario that would necessitate the use of a 2 x 2 Factorial Design. The research...
Identify the research scenario, including the relevant independent and dependent variables. Develop a hypothetical research scenario that would necessitate the use of a Pretest and Posttest Control...
Discuss the themes, theory, and/or phenomenon that would be anticipated to emerge as a result of the examination. Develop a hypothetical research scenario that would necessitate the use of the...
The senior leaders of DM Bicycle Company field into the conference room. their hands full of coffee containers. BlackBerrys, and the agenda for that morning's meeting. With the end of the fi scal...
Why are stocks usually more risky than bonds?
For coordinates $\left(x^{1}, x^{2} ight)$ and metric $g=\operatorname{diag}\left(g_{11}, g_{22} ight)$, the Gaussian curvature is For a sphere with coordinates defined in the following figure,...
Consider the holonomic basis defined in Box 26.1 . Using that the tangent vector for a curve can be written $t=t^{\mu} e_{\mu}=\left(d x^{\mu} / d \lambda ight) e_{\mu}$, show that Thus, \(g_{\mu...
The Lie bracket of vector fields $A$ and $B$ is defined as their commutator, $[A, B]=$ $A B-B A$. The Lie bracket of two basis vectors vanishes for a coordinate basis but not for a...

A company's current price is $90.23. Its current dividend is $6.50 a share. Its beta is 1.2

Question:

Expert Answer:

To calculate the intrinsic value of a stock using the Dividend Discount Model DDM we can use the fol... View the full answer

Financial management theory and practice

Students also viewed these finance questions