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You are analyzing the stock of ABC firm where its current stock price is 78$. The...
XYZ Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult...
XYZ Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years in millions of dollars: Items Revenues Costs of Good soles and operating expenses Depreciation Increase in net working capital Capital expenditures Marginal corporate tax rate Unlevered Net Income Year 1 106.5 47.7 25.9 3.1 29.1 40% 19.7 Year 2 159.9 59.9 35.5 7.6 43.8 40% 38.9 a. What are the...
The common stock of a firm paid a dividend of $1.75 in the year just ended....
The common stock of a firm paid a dividend of $1.75 in the year just ended. Suppose their dividend is expected to grow at a rate of 10% in the coming year, 8% in year two, and at a rate of 4% annually thereafter. If the required rate of return is 10%, what is the current value of their stock?
1. The market price of a stock is $24.06 and it just paid a dividend of...
1. The market price of a stock is $24.06 and it just paid a dividend of $1.44. The required rate of return is 11.53%. What is the expected growth rate of the dividend? Percentage round to 2 decimal places 2. A stock just paid a dividend of $1.13. The dividend is expected to grow at 29.53% for three years and then grow at 3.39% thereafter. The required return on the stock is 14.54%. What is the value of the stock?...
1. Medical Corporation of America (MCA) has a current stock price of $35, and its last...
1. Medical Corporation of America (MCA) has a current stock price of $35, and its last dividend (Do) was $2.50. In view of MCA's strong financial position, its required rate of return is 12%. If MCA's dividends are expected to grow at a constant rate in the future, what is the firm's expected stock price in five years? O r d! t bo to 10 rbv Choice: $43.68 Choice: $48.95 bivio Choice: $52.100 Choice: $68.75 m m to BOBO on...
Firm A just paid $2.50 per share and the current stock price is $36.00.... 1. Firm...
Firm A just paid $2.50 per share and the current stock price is
$36.00....
1. Firm A just paid $2.5 per share, and the current stock price on the market is $36.00. The beta of this stock is 1.2, and the risk-free rate is 2%. and the market return is 10%. You expect that the long term growth rate of this dividend would be 4%. What is the value of this stock? 2. From Bloomberg, you got the following information....
ABC Corp. has just paid a dividend of $0.57. ABC has an annual required return of...
ABC Corp. has just paid a dividend of $0.57. ABC has an annual required return of 12.55%. 1a: If dividends are annual and expected to be constant, what is the intrinsic value of ABC stock? 1b: What is ABC's dividend yield? 1c: From now on, assume that the dividend of $0.57 was a quarterly dividend. What is the quarterly discount rate? 1d: What is the intrinsic value if dividends are constant and quarterly? 1e: We now think that dividends will...
Questions 1-3 Create an excel file and solve the following problems. 1. Firm ABC has a...
Questions 1-3
Create an excel file and solve the following problems. 1. Firm ABC has a current market value of $41 per share with earnings of $3.64. What is the present value of its growth opportunities if the required return is 992 Use excel spinners to change required return to 8%, 10%, 11%, and 12%. Record and report present values for each. 2. Firm X pays a current (annual) dividend of $1 and is expected to grow at 20% for...
The common stock of Flavorful Teas has a beta of 48. The risk-free rate of return...
The common stock of Flavorful Teas has a beta of 48. The risk-free rate of return is 2.5 percent. The return on the market is 12 percent and. What is the expected return on this stock? If the Market risk premium is 8.5%, what is the expected return on this stock? ABC Corp just paid a dividend of $1.5 per share. The dividend is expected to grow at 4% a year indefinitely. If the required rate of return is 8.5%,...
The common stock of a firm paid a dividend of $1.75 in the year just ended. Suppose their dividend is expected to grow a...
The common stock of a firm paid a dividend of $1.75 in the year just ended. Suppose their dividend is expected to grow at a rate of 10% in the coming year, 8% in year two, and at a rate of 4% annually thereafter. If the required rate of return is 10%, what is the current value of their stock? I know the answer ($33.25) I want to know how to get the answer without a calculator (excel is fine).
. Kicssling Corp. pays a constant S9 dividend on its stock. The company will maintain this...
. Kicssling Corp. pays a constant S9 dividend on its stock. The company will maintain this dividend for the next eight years and will then cease paying dividends forever. If the required return on this stock is 11 percent, what is the current share price? 1. Metallica Bearings, Inc. is a young start-up company. No dividends will be paid on the stock over the next nine years, because the first needs to plow back its carnings to fuel growth. The...
XYZ Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years in millions of dollars: Items Revenues Costs of Good soles and operating expenses Depreciation Increase in net working capital Capital expenditures Marginal corporate tax rate Unlevered Net Income Year 1 106.5 47.7 25.9 3.1 29.1 40% 19.7 Year 2 159.9 59.9 35.5 7.6 43.8 40% 38.9 a. What are the...
1. Medical Corporation of America (MCA) has a current stock price of $35, and its last dividend (Do) was $2.50. In view of MCA's strong financial position, its required rate of return is 12%. If MCA's dividends are expected to grow at a constant rate in the future, what is the firm's expected stock price in five years? O r d! t bo to 10 rbv Choice: $43.68 Choice: $48.95 bivio Choice: $52.100 Choice: $68.75 m m to BOBO on...
Firm A just paid $2.50 per share and the current stock price is
$36.00....
1. Firm A just paid $2.5 per share, and the current stock price on the market is $36.00. The beta of this stock is 1.2, and the risk-free rate is 2%. and the market return is 10%. You expect that the long term growth rate of this dividend would be 4%. What is the value of this stock? 2. From Bloomberg, you got the following information....
Questions 1-3
Create an excel file and solve the following problems. 1. Firm ABC has a current market value of $41 per share with earnings of $3.64. What is the present value of its growth opportunities if the required return is 992 Use excel spinners to change required return to 8%, 10%, 11%, and 12%. Record and report present values for each. 2. Firm X pays a current (annual) dividend of $1 and is expected to grow at 20% for...
. Kicssling Corp. pays a constant S9 dividend on its stock. The company will maintain this dividend for the next eight years and will then cease paying dividends forever. If the required return on this stock is 11 percent, what is the current share price? 1. Metallica Bearings, Inc. is a young start-up company. No dividends will be paid on the stock over the next nine years, because the first needs to plow back its carnings to fuel growth. The...
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