Your firm is expected to earn $1.51/share next year and has a cost of capital of...
Your firm is expected to earn $1.51/share next year and has a cost of capital of 14.2%. Assume these earnings resemble a perpetuity with growth rate 4.1%. What is its price/earnings ratio?
Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
Homework Answers
Current price=D1/(Cost of capital-Growth rate)
=1.51/(0.142-0.041)
=$14.9505
Hence price/earnings ratio=Market price/EPS
=$14.9505/$1.51
=9.9010(Approx).
Add Answer to:
Your firm is expected to earn $1.51/share next year and has a
cost of capital of...
Please answer them Carry out calculations to at least 4 decimal places. Enter percentages as whole...
Please answer them Carry out
calculations to at least 4 decimal places. Enter percentages as
whole numbers. Example: 3.03% should be entered as 3.03. Do not
include commas or dollar signs in numerical answers.
Question 1 3 pts An acquirer with a P/E ratio of 13 and earnings of $1.95 seeks to take over another target firm with value $17.6 and P/E ratio 16. What is the new merged firm's P/E? Question 2 3 pts Your firm is expected to...
A firm has $4 billion in A-rated bonds with an expected interest rate of 3.1%. Its...
A firm has $4 billion in A-rated bonds with an expected interest rate of 3.1%. Its equity, worth $4 billion, is estimated to offer an expected geometric rate of return of about 14% per year. What is this firm's overall asset cost of capital? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
The P/E ratio on a stock market is 12. The underlying real earnings growth rate is...
The P/E ratio on a stock market is 12. The underlying real earnings growth rate is 1.6%, at a constant long-run inflation rate of 2.7%. What is the firm's nominal long-run cost of capital? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
A firm has a profit margin of 4.4% and an equity multiplier of 2.3. Its sales...
A firm has a profit margin of 4.4% and an equity multiplier of 2.3. Its sales are $143 million, and it has total assets of $95 million. What is its ROE? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
An acquirer with a P/E ratio of 13 and earnings of $1.95 seeks to take over...
An acquirer with a P/E ratio of 13 and earnings of $1.95 seeks to take over another target firm with value $17.6 and P/E ratio 16. What is the new merged firm's P/E? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
Stock XYZ has a P/E ratio of 16.3. You are trying to value another similar stock,...
Stock XYZ has a P/E ratio of 16.3. You are trying to value another similar stock, ABC, with earnings of $0.8. If you use a comparables approach, what should ABC be worth? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03%...
Carry out calculations to at least 4 decimal places. Enter
percentages as whole numbers. Example: 3.03% should be entered as
3.03. Do not include commas or dollar signs in numerical
answers.
Consider the following debt-free project for a machine: Physical Lifespan 7 years Capital Expense, Year 0...
Consider the following debt-free project for a machine: Physical Lifespan 7 years Capital Expense, Year 0 $14,000 EBITDA / Year $8,000 Cost of Capital 9.9% Tax Rate 39% Depreciation Life 4 years What is the value of this project? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.
Please answer both Carry out calculations to at least 4 decimal places. Enter percentages as whole...
Please answer both
Carry out calculations to at least 4 decimal places. Enter
percentages as whole numbers. Example: 3.03% should be entered as
3.03. Do not include commas or dollar signs in numerical
answers.
Please answer them Carry out calculations to at least 4 decimal places. Enter percentages as whole...
Please answer them Carry out
calculations to at least 4 decimal places. Enter percentages as
whole numbers. Example: 3.03% should be entered as 3.03. Do not
include commas or dollar signs in numerical answers.
D Question 7 3 pts Firm EFG is growing fast, and will produce earnings of $0.81/share next year. These earnings will grow at 3% per year, probably forever. EFG also has a cost of capital of 11.4%. What is the firm's P/E ratio? D Question 8...
Please answer them Carry out
calculations to at least 4 decimal places. Enter percentages as
whole numbers. Example: 3.03% should be entered as 3.03. Do not
include commas or dollar signs in numerical answers.
Question 1 3 pts An acquirer with a P/E ratio of 13 and earnings of $1.95 seeks to take over another target firm with value $17.6 and P/E ratio 16. What is the new merged firm's P/E? Question 2 3 pts Your firm is expected to...
Carry out calculations to at least 4 decimal places. Enter
percentages as whole numbers. Example: 3.03% should be entered as
3.03. Do not include commas or dollar signs in numerical
answers.
Please answer both
Carry out calculations to at least 4 decimal places. Enter
percentages as whole numbers. Example: 3.03% should be entered as
3.03. Do not include commas or dollar signs in numerical
answers.
Please answer them Carry out
calculations to at least 4 decimal places. Enter percentages as
whole numbers. Example: 3.03% should be entered as 3.03. Do not
include commas or dollar signs in numerical answers.
D Question 7 3 pts Firm EFG is growing fast, and will produce earnings of $0.81/share next year. These earnings will grow at 3% per year, probably forever. EFG also has a cost of capital of 11.4%. What is the firm's P/E ratio? D Question 8...
Most questions answered within 3 hours.
-
Problem #5
A communications cable is 2.00 km long and consists of two
parallel wires separated...
asked 4 minutes ago -
Cranium, Inc., purchases term papers from an overseas supplier
under a continuous review system. The average...
asked 3 hours ago -
1- What is the freezing point of pure water (in degrees
Celsius)?
2-
he molar mass...
asked 4 hours ago -
Determine the direction of the force that will act on the charge
in each of the...
asked 4 hours ago -
You purchase your daily coffee at the Chemist’s Coffeehouse and
have a choice of two cups:...
asked 6 hours ago -
Which of the following pairs of chemicals could be used to make
a buffer solution?
A.)...
asked 6 hours ago -
Problem 16-51 Sales
Activity Variance (LO 16-3)Odessa, Inc., reports the following
information concerning operations for the...
asked 7 hours ago -
Pictured on the right are thee point charges Q1 = 18.4 μC, Q2 =
-30.6 μC,...
asked 7 hours ago -
A graduate student is conducting research in psychology and
needs to obtain the IQ scores of...
asked 7 hours ago -
R2.84: There are 2 defective products in a production lot of 10.
An inspector randomly selected...
asked 9 hours ago -
Consider the following equilibrium system: COCl2(g) CO(g) +
Cl2(g) A 10.00 L evacuated flask is filled...
asked 9 hours ago -
1) What are the two distinct steps that one needs to perform
when developing a data...
asked 9 hours ago