Answer is D.PN=(rE-g) xDivN+1
Explanation : correct formula is as follows
PN=DivN+1/(rE-g)
please help Which of the following formulas is INCORRECT? A earnings growth rate = retention rate...
Bar Which of the following formulas is INCORRECT? qa. Pr='E- g) Div N+1 O B. Div = EPS, * Dividend Payout Rate OC. TE = (Div//P) +9 OD. earnings growth rate = retention rate x return on new investment
Question 3 Which of the following formulas is INCORRECT? A) g= retention rate x return on new investment B) Divt = EPS; ~ Dividend Payout Rate Divu C) PO TE-8 Divi D) rE = Po - g
Laurel Enterprises expects earnings next year of $3.94 per share and has a 30% retention rate, which it plans to keep constant. Its equity cost of capital is 9%, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 2.7 % per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be?
Which one of these is a correct means of calculating an expected rate of growth? Multiple Choice O ROA Dividend payout ratio O ROE x Profit margin ) ROA Profit margin O ROE x Retention ratio O ROA < Retention ratio
DFB, Inc. expects earnings this year of $4.49 per share, and it plans to pay a $2.55 dividend to shareholders at that time (one year from now). DFB will retain $1.94 per share of its earnings to reinvest in new projects that have an expected return of 15.4% per year. Suppose DFB will maintain the same dividend payout rate, retention rate, and return on new investments in the future and will not change its number of outstanding shares. a. What...
Laurel Enterprises expects earnings next year of $4.29 per share and has a 50 % retention rate, which it plans to keep constant. Its equity cost of capital is 9 %, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 4.5 % per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be? The current stock price will be...
Laurel Enterprises expects earnings next year of$3.99 per share and has a 30% retention rate, which it plans to keep constant. Its equity cost of capital is 11%, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 3.3% per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be?
Laurel Enterpnses expects earnings next year of S4.21 per share and has a 40% retention rate, which it plans to keep constant. Its equity cost of capital is 9%, which is also its expected return on new investment. If its earnings are expected to grow forever at a rate of 3% per year, what do you estimate the firm's current stock price to be? (Hint: its next dividend is due in one year.) The current stock price will be $U...
Suppose the Price/Earnings Ratio for the S&P 500 is 22 and the dividend payout ratio of the S&P 500 is 45%. The future growth rate of dividends is expected to be 4.80%. (USE EXCEL AND SHOW ALL FORMULAS) a. Compute the expected return of the Market. b. Use Goal Seek or Solver to determine the dividend growth rate that would yield an expected Market return of 8%. On Goal Seek please identify the.. i. Set Objective (Cell) ii. To Value...
DFB, Inc. expects earnings next year of $5.01 per share, and it plans to pay a $3.42 dividend to shareholders (assume that is one year from now). DFB will retain $1.59 per share of its earnings to reinvest in new projects that have an expected return of 15.5% per year. Suppose DFB will maintain the same dividend payout rate, retention rate, and return on new investments in the future and will not change its number of outstanding shares. Assume next...