The market price of a stock is $41.39 and it just paid $4.66 dividend. The dividend...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The market price of a stock is $41.39 and it just paid $4.66 dividend. The dividend is expected to grow at 2.56% forever. What is the required rate of return for the stock? Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924)) Suppose the risk-free rate is 1.41% and an analyst assumes a market risk premium of 5.28%. Firm A just paid a dividend of $1.16 per share. The analyst estimates the B of Firm A to be 1.26 and estimates the dividend growth rate to be 4.40% forever. Firm A has 271.00 million shares outstanding. Firm B just paid a dividend of $1.85 per share. The analyst estimates the B of Firm B to be 0.73 and believes that dividends will grow at 2.04% forever. Firm B has 180.00 million shares outstanding. What is the value of Firm A? Submit Answer format: Currency: Round to: 2 decimal places. A stock has an expected return of 18.00%. The risk-free rate is 2.49% and the market risk premium is 6.50%. What is the B of the stock? Submit Answer format: Number: Round to: 2 decimal places. The market price of a stock is $41.39 and it just paid $4.66 dividend. The dividend is expected to grow at 2.56% forever. What is the required rate of return for the stock? Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924)) Suppose the risk-free rate is 1.41% and an analyst assumes a market risk premium of 5.28%. Firm A just paid a dividend of $1.16 per share. The analyst estimates the B of Firm A to be 1.26 and estimates the dividend growth rate to be 4.40% forever. Firm A has 271.00 million shares outstanding. Firm B just paid a dividend of $1.85 per share. The analyst estimates the B of Firm B to be 0.73 and believes that dividends will grow at 2.04% forever. Firm B has 180.00 million shares outstanding. What is the value of Firm A? Submit Answer format: Currency: Round to: 2 decimal places. A stock has an expected return of 18.00%. The risk-free rate is 2.49% and the market risk premium is 6.50%. What is the B of the stock? Submit Answer format: Number: Round to: 2 decimal places.
Expert Answer:
Related Book For
Corporate Finance A Focused Approach
ISBN: 978-1439078082
4th Edition
Authors: Michael C. Ehrhardt , Eugene F. Brigham
Posted Date:
Students also viewed these finance questions
-
The current price of a stock is $97. You expect the price of the stock to be in the range of $95 to $105 in the next period. The call option with an exercise price of $105 is $1.30; the put option...
-
What would your required rate of return be on common stocks if you wanted a 5 percent risk premium to own common stocks given what you know from Problem 10? If common stock investors became more risk...
-
A firms earnings and dividends are expected to grow at a constant rate indefinitely, and it is expected to pay a dividend of $8.75 per share next year. Expected EPS and BVPS next year are $12 and...
-
Assume that on July 1, 2014, Big Corp. loaned little Corp. $12,000 for aperiod of one year at 6percent interest. What amount of interest revenue will big report for 2014? What amount of cash will big...
-
You are the internal auditor for a company conducting internal audit tests. You discover that the company is misusing federal grant funds. Instead of the funds being used for the designated purpose,...
-
Go to www.giddy.org/db/corpspreads.htm. The spreads are listed in the form of basis points (100 basis points = 1 percent) above the Treasury security with the same maturity. 1. First determine the...
-
Part of the required input to the viscoelastic option in some finite element codes is a table showing the time-dependent, isotropic shear modulus \(G(t)\) at different times \(t\). Explain how you...
-
Jackie Wilson, manager of Expert Building Company, is a valued and trusted employee. She has been with the company from its start two years ago. Because of the demands of her job, she has not taken a...
-
Hoteliers have been hard at work to leave a positive first impression on their valued guests for decades. It is a pivotal element of a hotel's reputation, as how guests first perceive a hotel can set...
-
8. Jack Whitcombe and Sons is a consultant engineering firm. The accounts for the firm are as follows. Bank Car Expense HST Recoverable HST Payable J. Whitcombe, Capital J. Whitcombe, Drawings Fees...
-
Mr John Brown (01/11/30) is a 91-year-old man who was admitted to the Royal Adelaide Hospital by ambulance after being found by the backdoor following a fall in the backyard. It is unknown when the...
-
Geoffrey's income for 2021-22 comprises a salary of 114,600 and dividends received of 4,400. He makes qualifying Gift Aid donations of 7,200 during the year. Calculate his 2021-22 income tax liability
-
At the present time, is inflation or disinflation more of a concern for the United States? Why? What is the outlook for inflation? Why?
-
We regret to announce that we can offer the 50 percent discount only to the the first 25 buyers, so act quickly! Revise the following statements to make them more positive and courteous.
-
Which aspects of a business may be detailed by a BPMN diagram? Which may be detailed by a state machine diagram?
-
Develop a library based on the functions that we have considered in this book for computing properties of integers. Include functions for determining whether a given integer is prime; determining...
-
The hedge funds AUM is $200 million. The fund has a typical two and twenty fee structure. The funds benchmark, Barclays Hedge Fund Index, showed a return of 15.5% for 2021, while the hedge fund...
-
Imagine that your best friend knows you are taking a psychology course and wonders what psychology is all about. How would you define psychology for your friend? Write an essay on the discipline of...
-
The balance sheet of Hutter Amalgamated is shown below. If the 12/31/2010 value of operations is $756 million, what is the 12/31/2010 intrinsic market value of equity? Balance Sheet, December 31,...
-
Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year's capital budget. The projects are independent. The cash outlay for the truck...
-
(1) Harry Davis estimates that if it issues new common stock, the flotation cost will be 15%. Harry Davis incorporates the flotation costs into the DCF approach. What is the estimated cost of newly...
-
Integral balances can also be used for heat transfer in a turbulent-flow boundary layer if a form for the velocity profile is assumed. A common form is the 1/7th-power law:...
-
Air at \(300 \mathrm{~K}\) and \(1 \mathrm{~atm}\) flows along a flat plate at \(3 \mathrm{~m} / \mathrm{s}\). At a location of \(0.3 \mathrm{~m}\) from the leading edge, find the thickness of the...
-
A vertical plate \(3 \mathrm{~m}\) long is at a temperature of \(400 \mathrm{~K}\) and exposed to air at \(300 \mathrm{~K}\). Calculate the thickness of the boundary layer and the value of the local...
Study smarter with the SolutionInn App