Question: please help : The following information is available for two different common stocks: company A and Company B. Picture Company A Company B Free cash
please help :
The following information is available for two different common stocks: company A and Company B. Picture Company A Company B Free cash flow per share $1.00 $5.00 in the current year 8% 4% Growth rate in cash flow per share Beta 1.3 .8 Risk-free return 7% 7% Expected return on all 13.5% 13.5% stocks a. Estimate the cost of equity for each firm. b. Assume that the companies' growth rates will continue at the same rate indefinitely. Estimate the per share value of each companies' common stock
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