Question: Please type the answer by computer so I can see it clearly, thank you!!!! Assume it's the end of 2021, and you've been provided the
Please type the answer by computer so I can see it clearly, thank you!!!!
Assume it's the end of 2021, and you've been provided the following information about EFG Inc.'s common shares (the 2022 and 2023 numbers are estimates). Assume that EFG Inc. has a 10% cost of equity.
1(a) Calculate EFG's book value of equity per share (BPS) for 2021 and 2022.
1(b) Assume that after 2023, EFG's abnormal earnings growth(AEG) will grow at a constant growth rate of 3% forever. Calculate the intrinsic value per share at the end of year 2021.
1(c) Assume that after 2023, ABC's abnormal earnings growth (AEG) will grow at a constant rate forever. Given ABC's current stock price of $2150 per share, calculate the market implied forecast of EPS for 2024 .
EPS DPS BPS Residual earnings Abnormal earnings growth 2021 30 10 ??? 10 2022 40 10 ??? ??? 10 2023 50 10 EPS DPS BPS Residual earnings Abnormal earnings growth 2021 30 10 ??? 10 2022 40 10 ??? ??? 10 2023 50 10
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