Use Kinder Morgan (KMI), United Parcel Services (UPS)

The 2 companies are: Origen Financial (ORGN) and Martin Midstream (MMLP) Dividends paid by Kinder Morgan 2013 2014 2015 2016 2017 Dividend. 4.6 4.6 7.5 2.4. 2.4 Dividends paid by UPS 2013 2014 2015 2016 2017 Dividend 2.5 2.9 2.5 2.8 2.9

These companies paid out dividends for the past five years (2013 2017)

Using the past dividend payout information between 2013 and 2017, compute the growth rate (g) for these companies. Your companies must have complete history of dividend payout during these periods. You can find such information at www.dividendinformation.com. If your company lacks the dividend payout information, you need to select new company. Show me your works (35 points).

First, lets assume that required return (R) is 10% for all these companies. Using R, dividend information, and growth rate (g) from the question 1, compute the stock prices of these companies. Second, lets assume that required return (R) is 20% for all these companies. Using R, dividend information, and growth rate (g) from the question 1, compute the stock prices of these companies. Show me your works (35 points).

Compare your estimated stock prices with actual stock price (January 2, 2018). Then tell me whether each stock is undervalued or fair-valued or overvalued based on your estimation. Whats your decision if you hold these stocks? Whats your decision if you dont hold these stocks? Show me your works (30 points).