a preferred share having present value of $1000 will pay $20 dividend. what's its rate of...
a preferred share having present value of $1000 will pay $20 dividend. what's its rate of return.
Homework Answers
Calculation of rate of return:
Rate of return= dividend/present value
Rate of return= 20/1000= 0.02
Rate of return= 2%
Add Answer to:
a preferred share having present value of $1000 will
pay $20 dividend. what's its rate of...
Investors are willing to pay $37.00 for a preferred share that recently paid an annual dividend...
Investors are willing to pay $37.00 for a preferred share that recently paid an annual dividend of $1.75. The firm is expected to experience growth of 5.00% per year and its combined state + federal tax rate is 25%. How much would an investors earn on these shares? 4.73% 4.93% 4.3% 3.58% A firm has an outstanding issue of $1,000 par value bonds due in 10 years, currenlty selling for $1,158.91. Investors are earning 14%. What is the coupon rate...
What is the value of a preferred stock when the dividend rate is 16 percent on a $75 par value?
Problem 8-1(Preferred stock valuation) What is the value of a preferred stock when the dividend rate is 16 percent on a $75 par value? The appropriate discount rate for a stock of this risk level is 14 percent. The value of the preferred stock is _______ . (Round to the nearest cent.)(Preferred stock valuation) The preferred stock of Gandt Corporation pays a $0.50 dividend. What is the value of the stock if your required return is 11 percent? The value of the...
Your answer: (CHAPTER 8) A Corporation announced of its plans to pay: $10 dividend per share...
Your answer: (CHAPTER 8) A Corporation announced of its plans to pay: $10 dividend per share in 1 year, $20 dividend per share in 2 years, $30 dividend per share in 3 years, after which the dividend will be increasing at a constant annual growth rate of 3 percent. The rate of return for this company is 8%. Calculate the value of one share of stock of this company. Part of the calculation will be finding the Present Value of...
QUESTION 11 Quixy Corp is expected to pay a dividend next year of $5.3 per share....
QUESTION 11 Quixy Corp is expected to pay a dividend next year of $5.3 per share. The dividend is expected to grow at a constant rate of 4% per year if Quixy Corp stock is selling for $59.37 per share, what is the stockholders' expected rate return? Submit your answer as a percentage and round to two decimal places (Ex 0.00%) QUESTION 12 Elicon Inc. preferred stock pays a constant annual dividend of $10.46 per share. If investors' required rate...
The market price of a share of preferred stock is $23.71 and the dividend is $2.40....
The market price of a share of preferred stock is $23.71 and the dividend is $2.40. What discount rate did the market use to value the stock? Suppose the risk-free rate is 1.43% and an analyst assumes a market risk premium of 7.51%. Firm A just paid a dividend of $1.49 per share. The analyst estimates the β of Firm A to be 1.22 and estimates the dividend growth rate to be 4.61% forever. Firm A has 286.00 million shares...
Madison City Bank’s preferred stock has a par value of $30. What is its present value...
Madison City Bank’s preferred stock has a par value of $30. What is its present value to you if it has a 7% dividend rate and your required rate of return on similar securities is 6.50%?
Dick's Co Pays an annual dividend of $6 to its preferred stock. The rate of return...
Dick's Co Pays an annual dividend of $6 to its preferred stock. The rate of return on T-Bill is 3% and the market risk premium is 8%. What is the intrinsic value of the preferred stock if the beta of the preferred stock is 1.257 Mountain Development Corporation is expected to pay a dividend of $3.00 in the upcoming year. Predicted to grow at the rate of 8% per year. The firms market capitalization rate is 14%. Using the constant...
What is the value of a preferred stock when the dividend rate is 16 percent on a $125 par value?
(Preferred stock valuation) What is the value of a preferred stock when the dividend rate is 16 percent on a $125 par value? The appropriate discount rate for a stock of this risk level is 13 percent. The value of the preferred stock is $ _______ . (Round to the nearest cent.) (Preferred stock valuation) The preferred stock of Gandt Corporation pays a $3.75 dividend. What is the value of the stock if your required return is 14 percent? The value of the...
12. Valuing preferred stock Companies that have preferred stock outstanding promise to pay a stated dividend...
12. Valuing preferred stock Companies that have preferred stock outstanding promise to pay a stated dividend for an infinite period. Preferred stock is treated like a perpetuity if the payments last forever. Preferred stocks are considered to be a hybrid of a common stock and a bond. For example, one of the major differences between preferred shares and bonds is that the issuing companies can suspend the payment of their preferred dividends without throwing the company into bankruptcy. However, similar...
E-Eyes.com just issued some new preferred stock. The issue will pay an annual dividend of $20...
E-Eyes.com just issued some new preferred stock. The issue will pay an annual dividend of $20 in perpetuity, beginning 7 years from now. If the market requires a 12 percent return on this investment, how much does a share of preferred stock cost today?
Your answer: (CHAPTER 8) A Corporation announced of its plans to pay: $10 dividend per share in 1 year, $20 dividend per share in 2 years, $30 dividend per share in 3 years, after which the dividend will be increasing at a constant annual growth rate of 3 percent. The rate of return for this company is 8%. Calculate the value of one share of stock of this company. Part of the calculation will be finding the Present Value of...
QUESTION 11 Quixy Corp is expected to pay a dividend next year of $5.3 per share. The dividend is expected to grow at a constant rate of 4% per year if Quixy Corp stock is selling for $59.37 per share, what is the stockholders' expected rate return? Submit your answer as a percentage and round to two decimal places (Ex 0.00%) QUESTION 12 Elicon Inc. preferred stock pays a constant annual dividend of $10.46 per share. If investors' required rate...
Dick's Co Pays an annual dividend of $6 to its preferred stock. The rate of return on T-Bill is 3% and the market risk premium is 8%. What is the intrinsic value of the preferred stock if the beta of the preferred stock is 1.257 Mountain Development Corporation is expected to pay a dividend of $3.00 in the upcoming year. Predicted to grow at the rate of 8% per year. The firms market capitalization rate is 14%. Using the constant...
12. Valuing preferred stock Companies that have preferred stock outstanding promise to pay a stated dividend for an infinite period. Preferred stock is treated like a perpetuity if the payments last forever. Preferred stocks are considered to be a hybrid of a common stock and a bond. For example, one of the major differences between preferred shares and bonds is that the issuing companies can suspend the payment of their preferred dividends without throwing the company into bankruptcy. However, similar...
Most questions answered within 3 hours.
-
2. Use the following information in the table to answer the
following questions. (Numbers are in...
asked 1 minute from now -
A martial artist is practicing breaking 5 boards. He is able to
break aboard with probability...
asked 1 minute from now -
The rate constant of a first-order reaction is 2.95 × 10−4 s−1
at 350.° C. If...
asked 1 minute ago -
The fuel economy of a 2011 Lexus RX 350 2wd 6 cylinder 3.5 L
automatic 5...
asked 6 minutes ago -
i.
the synthesized compund 2-bromo-butanal i have a IR peak at about
3200 and one at...
asked 6 minutes ago -
A
752 mL sample of water was placed in a 1000 gram pan of aluminum.
The...
asked 17 minutes ago -
1.In the context of chelation, what does binding strength mean?
What happens at the molecular level...
asked 10 minutes ago -
Describe two obstacles that makes fixing atmospheric nitrogen
difficult.
asked 29 minutes ago -
Evelyn incorporates her sole proprietorship, transferring it to
newly formed Papaya Corporation. The assets transferred have...
asked 16 minutes ago -
Assume that in a hydrogen atom, the electron circles the nucleus
in a circle of radius...
asked 24 minutes ago -
1 point) Given the significance level α=0.01 find the following:
(a) left-tailed z value z= (b)...
asked 19 minutes ago -
Calculate the expected value, the variance, and the standard
deviation of the given random variable X....
asked 20 minutes ago