Asym Corp has an ROE of 12%, a beta of 1.25, and plans to maintain indefinitely its plowback of 2/3. This year's earnings per share was $6. The annual dividend was just paid. If the consensus estimate of next year's market return is 10%, and risk-free rate is 6%, answer the following questions:

Find the price of the stock? (4 Points)

Find the Price-earnings ratio for Asym? (4 Points)

Is the firm deriving more value from assets in place or growth opportunities? Base your analysis on the PVGO concept we discussed in class. Make a recommendation to improve shareholder value. (4 Points)

You have estimated the following future dividend payment schedule for ROE Corp.

Year 1: $0.80

Year 2: $1.00

Year 3: $1.15

After year 3 - steady dividend growth of 9 %.

The required rate of return for ROE is 11%. What is your estimate for its current price? (6 Points)