SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE
A firm pays a current dividend of $1, which is expected to grow at a rate...
Questions 4-6 4. Firm Y currently pays a dividend of $1.22, which is expected to grow indefinitely at 5%. If the current value of the firm's shares based on constant-growth DDM is $32.03, what is the required rate of return? 5. MM Corp, has an ROE of 16% and a plowback ratio of 50%. If the coming year's earnings are expected to be s per share, at what price will the stock sell? The market capitalization rate is 12%. 6....
*Using the Constant-Growth Dividend DDM compute the Required Rate of Return for Company Y based on the following information: --Company Y pays a current dividend of $1.50 which is expected to grow indefinitely at a rate of 5%. The current value of Company Y shares is $42.50.
Question 39 Carla Tire’s current dividend is $5.30. Dividends are expected to grow by 20 percent for years 1 to 3 and 10 percent thereafter. The required rate of return on the stock is 13 percent. What is Carla’s current stock price? (Round intermediate calculations to 4 decimal places, e.g. 7.1285 and final answer to 2 decimal places, e.g. 115.61.) Stock price is $ Question 34 Bridgeport Supplies Ltd. currently doesn’t pay any dividends but is expected to start paying...
A firm pays a $1.50 dividend at the end of year one. It has a share price of $60 (P) and a constant growth rate (g) of 9 percent. a. Compute the required (expected) rate of return (KJ. (Do not round Intermediate calculations, Round the final answer to 2 decimal places.) Required rate of return Also indicate whether each of the following changes would make the required rate of retum (K) go up or down, in each question below, assume...
1. ABC, Inc., just paid a dividend of $1.36, and the company expect to grow its dividend at a constant rate of 4%. What is ABC's required rate of return if its today's value based on the dividend discount model is $34.66, ? (Do not round intermediate calculations. Round your answer to 2 decimal places.) 2. a. The common stock of Russel, Corp. is currently selling at $60 and investors require a rate of return of 16%. Russel is expected...
The last dividend paid by GM was $1.25. The dividend growth rate is expected to be constant at 15% for 3 years, after which dividends are expected to grow at a rate of 6% forever. If the firms required return (rs) is 11% in Years 1 and 2 and then increases to 13% thereafter and (rs) remains at 13% indefinitely. What is the stocks current price?
Deployment Specialists pays a current (annual) dividend of $1 and is expected to grow at 22% for two years and then at 4% thereafter. If the required return for Deployment Specialists is 10.5%, what is the intrinsic value of its stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Intrinsic value
A company's stock pays an annual dividend that is expected to increase by 9% annually. The stock commands a market rate of return of 12% and sells for $60.50 a share. What is the expected amount of the next dividend to be paid on the stock? Battery Co. will pay an annual dividend of $2.08 a share on its common stock next year. Last week, the company paid a dividend of $2.00 a share. The company adheres to a constant...
ABC Company just paid out a dividend of $2 and expects this dividend to grow indefinitely at a rate of g% per year. ABC has 100,000 shares outstanding with a current market price of $26 per share. ABC’s beta is 1.5, the return on the market is 9%, and the risk-free rate is 3%. Calculate the growth rate “g” so that the market is in equilibrium (i.e., the CAPM-based return on ABC shares equals the Dividend-Growth-Model based return).
A firm just paid a $4/share dividend. Dividends are expected to grow at a rate of 17% for the next 2 years, followed by a constant dividend growth rate of 6% thereafter. If the required rate of return for the stock is 13.25%, what is the price of the stock? A. $53.88 B. $68.26 C. $70.82 D. $83.47