A sell-side analyst is valuing a public firm based on the following assumptions: Firm just paid...
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A sell-side analyst is valuing a public firm based on the following assumptions: Firm just paid a dividend of $1.00 Growth rate was 20 percent last year Cost of equity is 10%. Assuming the growth rate will linearly drop to long term stable rate of 4 percent over next 8 years and stay at 4 percent forever. Find the current fair stock price. A sell-side analyst is valuing a public firm based on the following assumptions: Firm just paid a dividend of $1.00 Growth rate was 20 percent last year Cost of equity is 10%. Assuming the growth rate will linearly drop to long term stable rate of 4 percent over next 8 years and stay at 4 percent forever. Find the current fair stock price.
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Step 12 Dividend just paid 1 Cost of equity 10 Constant g... View the full answer
Related Book For
Fundamental Managerial Accounting Concepts
ISBN: 978-1259569197
8th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Olds
Posted Date:
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