Question: Please answer all question with working n calculation tqvm Question 5 (valuation) Chad Co is a stock-market-listed company which has managed to increase earnings over

Please answer all question with working n calculation tqvm

Question 5 (valuation) Chad Co is a stock-market-listed company which has managed to increase earnings over the last year. As a result, the board of directors has increased the dividend payout ratio from 40.0% for the year to March 2014 to 41.4% for the year to March 2015. Chad Co has a cost of equity of 12.5%. The following information is also available 2015 S000 Year to March 2014 $000 13.20013.840 8,000 Earnings Ordinary shares 8,000 The nominal value of the ordinary shares of Chad Co is S0-50 per share. Listed companies similar to Chad Co have an earnings yield of 8.2% Required (a) Calculate the equity market value of Chad Co using the dividend growth model (3 marks) (b) Calculate the equity market value of Chad Co using the earnings yield method. (2 marks) (c) Discuss the relative merits of the dividend growth model and the earnings yield method as a way of valuing Chad Co

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Hi Can you assist with the attached assignment? Thanks Bayerische Motoren Werke Aktiengesellschaft (DB:BMW) > Financials > Key Stats In Millions of the trading currency, except per share items....

Hi Ruchi, I need help with the attached assignment. It's due in about a week. Thanks 1) The paper should be written in APA style Research Paper format. This is the link that explains the research...

QUESTION: PLEASE ANSWER 1 AND 2 CHAPTER 10 1. What kinds of long term liabilities does the company report? Has there been any new long-term debt issued this year? 2. What are the stated interest...

ACTIVITY DESCRIPTION The financial statements of The North West Company Inc. and Sobeys Inc. are presented in Appendix A and B in your Financial Accounting Tools for Business Decision- Making 7th...

Please answer this question.. Very easy. -What sources of value most plausibly account for the differences between buyer and seller? -Structure and execute a discounted cash flow valuation of all of...

Once you have read the article ?Comparing the Accuracy and Explainability of Dividend, Free Cash Flow, and Abnormal Earnings Equity Value Estimates?, review and complete the questions below. Use the...

please answer this question as a excel file, in next few hours. 1- Please calculate what amount should be the Capital Account in order to have balanced sheet of YOUR COMPANY. (5 points) BALANCE SHEET...

Please find attached financial statements for Apple Inc, Samsung Inc. and word document that contains template and question. (for Samsung Inc, you can use the information from page 4 to 14). 1....

please answer these question and finish them in 3 hours, give the detail andexplanation of the every step to me , thank you ! Examination Cover Page Examination Period: Academic Institution: Academic...

Please answer the question in the attached document. Consolidated Balance Sheet - USD ($) $ in Thousands Current assets Cash and equivalents Restricted cash and cash equivalents Accounts and notes...

Let A = {1, 2, 3, ... , 7}. Write a computer program (or develop an algorithm) that lists all the subsets B of A, where |B| = 4.

PR Company pays $10,000 in cash and issues stock with a fair value of $40,000 to acquire all of SX Corporations stock. SX will be a subsidiary of PR. Balance sheet accounts just prior to the...

to reduce counterparty risk in repo transactions, the repo margin is held at zero, the interest on the transaction is paid in advance, a haircut is taken on the collateral

? ? ? ? ? ? ? o b j e c t s a r e e x t e n d e d b y a d d i n g n e w m e t h o d s t o t h o s e o b j e c t ' s p r o t o t y p e s . Question 1 6 Answer a . Host b . Custom c . Base d . Native