Miltmar Corporation will pay a year-end dividend of $3, and dividends thereafter are expected to grow...
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Miltmar Corporation will pay a year-end dividend of $3, and dividends thereafter are expected to grow at the constant rate of 5% per year. The risk-free rate is 4%, and the expected return on the market portfolio is 15%. The stock has a beta of 0.84. a. Calculate the market capitalization rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Market capitalization rate % b. What is the intrinsic value of the stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Intrinsic value Miltmar Corporation will pay a year-end dividend of $3, and dividends thereafter are expected to grow at the constant rate of 5% per year. The risk-free rate is 4%, and the expected return on the market portfolio is 15%. The stock has a beta of 0.84. a. Calculate the market capitalization rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Market capitalization rate % b. What is the intrinsic value of the stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Intrinsic value
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Answer rating: 100% (QA)
a Calculate the market capitalization rate Do not round intermediate calculations Round your answer ... View the full answer
Related Book For
Financial Reporting Financial Statement Analysis and Valuation
ISBN: 978-0324302950
6th edition
Authors: Clyde P. Stickney
Posted Date:
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