Question #6: Residual IncomeModel Panera Bread expects earnings per share of $2.56 next year. The current...
Question #6: Residual IncomeModel
Panera Bread expects earnings per share of $2.56 next year. The current book value is $4.70 per share. The required rate of return is 11% and earnings are expected to grow at a rate of 3 percent indefinitely. Given this information calculate the share price for Panera Bread using the Residual Income Model.
Homework Answers
Value = book value + (NOPAT - equity charge)/(r-g)
=4.7 + (2.56- 0.11*4.7) / (0.11-0.03)
=30.2375
Add Answer to:
Question #6: Residual IncomeModel
Panera Bread expects earnings per share of $2.56 next year. The
current...
Bill’s Bakery expects earnings per share of $2.1 next year. Current book value is $3.8 per share. The appropriate disco...
Bill’s Bakery expects earnings per share of $2.1 next year. Current book value is $3.8 per share. The appropriate discount rate for Bill’s Bakery is 12 percent. Calculate the share price for Bill’s Bakery if earnings grow at 2.5 percent forever.
Question 7 1 pts LMN Co. expects earnings per share of $4.41 next year. Current book...
Question 7 1 pts LMN Co. expects earnings per share of $4.41 next year. Current book value is $5.84 per share. The appropriate discount rate for LMN is 6.69 percent. Calculate the share price (in $) for LMN if earnings grow at 2.78 percent forever. Answer to two decimals.
Bill’s Bakery expects earnings per share of $2.34 next year. Current book value is $4.1 per share. The appropri...
Bill’s Bakery expects earnings per share of $2.34 next year. Current book value is $4.1 per share. The appropriate discount rate for Bill’s Bakery is 15 percent. Calculate the share price for Bill’s Bakery if earnings grow at 2.7 percent forever. (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.) Share price $
Bill's Bakery expects earnings per share of $2.10 next year. Current book value is $3.80 per share. The appropriate discount rate for Bill's Bakery is 12 percent. Calculate the share price fo...
Bill's Bakery expects earnings per share of $2.10 next year. Current book value is $3.80 per share. The appropriate discount rate for Bill's Bakery is 12 percent. Calculate the share price for Bill's Bakery if earnings grow at 2.50 percent forever. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Bill's Bakery expects earnings per share of $2.10 next year. Current book value is $3.80 per share. The appropriate discount rate for Bill's Bakery is 12 percent....
Laurel Enterprises expects earnings next year of $4.12 per share and has a 30 % retention...
Laurel Enterprises expects earnings next year of $4.12 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 Enterprises expects earnings next year of$3.99 per share and has a 30% retention rate, which...
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 Enterprises expects earnings next year of $4.29 per share and has a 50 % retention rate
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...
12. Laurel Enterprises expects earnings next year of $3.51 per share and has a 50% retention...
12. Laurel Enterprises expects earnings next year of $3.51 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 Enterpnses expects earnings next year of S4.21 per share and has a 40% retention rate,...
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...
CH7 1. Laurel Enterprises expects earnings next year of $3.84 per share and has a 50%...
CH7 1. Laurel Enterprises expects earnings next year of $3.84 per share and has a 50% retention rate, which it plans to keep constant. Its equity cost of capital is 1 1%, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 5.5% per year If its next dividend is due in one year, what do you estimate the firm's current stock price to be? 2, Laurel Enterprises expects earnings...
Question 7 1 pts LMN Co. expects earnings per share of $4.41 next year. Current book value is $5.84 per share. The appropriate discount rate for LMN is 6.69 percent. Calculate the share price (in $) for LMN if earnings grow at 2.78 percent forever. Answer to two decimals.
Bill's Bakery expects earnings per share of $2.10 next year. Current book value is $3.80 per share. The appropriate discount rate for Bill's Bakery is 12 percent. Calculate the share price for Bill's Bakery if earnings grow at 2.50 percent forever. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Bill's Bakery expects earnings per share of $2.10 next year. Current book value is $3.80 per share. The appropriate discount rate for Bill's Bakery is 12 percent....
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...
CH7 1. Laurel Enterprises expects earnings next year of $3.84 per share and has a 50% retention rate, which it plans to keep constant. Its equity cost of capital is 1 1%, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 5.5% per year If its next dividend is due in one year, what do you estimate the firm's current stock price to be? 2, Laurel Enterprises expects earnings...
Most questions answered within 3 hours.
-
(Expected rate of return and risk) Carter Inc. is evaluating a
security. Calculate the investment’s expected...
asked 31 minutes ago -
What specific indicators can point to lack of progress for
African Americans in American society?
asked 1 hour ago -
1-The Electrons in a beam are moving at 2.7×108 m/s in an
electric field of 15000...
asked 1 hour ago -
A gas tank is a vertical cylinder. It has a radius of 1m, a
height of...
asked 2 hours ago -
Accent Software faces the following conditions. All of these
support Accent’s use of a market-penetration pricing...
asked 3 hours ago -
A mathematically inclined friend emails you the following
instructions: "Meet me in the cafeteria the first...
asked 3 hours ago -
A monopoly sells in two countries . The demand curves in the two
countries are p1...
asked 4 hours ago -
A .15kg rubber ball is bounced off a wall. Before hitting the
wall, the ball moves...
asked 4 hours ago -
A manufacturing company preparing to build a new plant is
considering three potential locations for it....
asked 4 hours ago -
B. If compound Y has approximately the same values of solubility
in toluene as compound X,...
asked 5 hours ago -
Oscar Inc. has inventory in Japan valued at 39,051,000 Yen one
year ago. One year ago...
asked 5 hours ago -
If Canada suffered from "fundamental disequilibrium," and its
government choose not to devalue its currency, a...
asked 5 hours ago