Aaron Inc. has 303 million shares outstanding. It expects earnings at the end of the year...
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Aaron Inc. has 303 million shares outstanding. It expects earnings at the end of the year to be $630 million. The firm's equity cost of capital is 10%. Aaron pays out 50% of its earnings in total: 30% paid out as dividends and 20% used to repurchase shares. If Aaron's earnings are expected to grow at a constant 7% per year, what is Aaron's share price? A. $17.33 B. $69.30 OC. $34.65 OD. $51.98 ... Aaron Inc. has 303 million shares outstanding. It expects earnings at the end of the year to be $630 million. The firm's equity cost of capital is 10%. Aaron pays out 50% of its earnings in total: 30% paid out as dividends and 20% used to repurchase shares. If Aaron's earnings are expected to grow at a constant 7% per year, what is Aaron's share price? A. $17.33 B. $69.30 OC. $34.65 OD. $51.98 ...
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Answer rating: 100% (QA)
First we need to calculate Aarons total dividends per share Total earnings 630 million Payout ratio ... View the full answer
Related Book For
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Posted Date:
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