has come out with an even better product. As a result, the firm projects an ROE of 20%, and it will maintain a plowback ratio of 0.40. Its earnings this year will be $2 per share. Investors expect a 12% rate of return on the stock.
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- Franklin Co has a dividend payout ratio of 0.8 and reinvests the remainder of earnings in projects with expected return of 13%. If you expect next year's EPS (EPS1) to be $2.85and investors require a return of 8.1%, what is a fair price for the stock today? Round your answer to the nearest penny.A stock sells for a price of $60. Next year's dividend will be $3 per share. If the ROE ("project return") on reinvested funds is 10% and the company has a payout ratio of 40%, what must be the market rate (r)?Arcs and Triangles paid an annual dividend of $1.47 a share last month. The company is planning on paying $1.52, $1.58, and $1.60 a share over the next three years, respectively. After that, the dividend will be constant at $1. 79 per share per year. What is the market price of this stock if the market rate of return is 10.0 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
- Barton Industries expects next year's annual dividend, D1, to be $2.40 and it expects dividends to grow at a constant rate g = 4.4%. The firm's current common stock price, P0, is $21.40. If it needs to issue new common stock, the firm will encounter a 5% flotation cost, F. Assume that the cost of equity calculated without the flotation adjustment is 12% and the cost of old common equity is 11.5%. What is the flotation cost adjustment that must be added to its cost of retained earnings? Do not round intermediate calculations. Round your answer to two decimal places. % What is the cost of new common equity considering the estimate made from the three estimation methodologies? Do not round intermediate calculations. Round your answer to two decimal places. %Boehm Incorporated is expected to pay a $3.30 per share dividend at the end of this year (i.e., D1 = $3.30). The dividend is expected to grow at a constant rate of 5% a year. The required rate of return on the stock, rs, is 15%. What is the estimated value per share of Boehm's stock? Do not round intermediate calculations. Round your answer to the nearest cent.Barton Industries expects next year's annual dividend, D1, to be $1.80 and it expects dividends to grow at a constant rate gL = 4.9%. The firm's current common stock price, P0, is $20.50. If it needs to issue new common stock, the firm will encounter a 4.2% flotation cost, F. Assume that the cost of equity calculated without the flotation adjustment is 12% and the cost of old common equity is 11.5%. What is the flotation cost adjustment that must be added to its cost of retained earnings? Round your answer to 2 decimal places. Do not round intermediate calculations.% What is the cost of new common equity? Round your answer to 2 decimal places. Do not round intermediate calculations.%
- Sheltech Real State company is currently paying dividnd of Tk 3.75 per share, which is expected to grow at a constant rate of 7.85% per year . Investores required rate of return is 16 percent. Calculate the price of the stock and justify your findings to take stock investment decisions.Barton Industries expects next year's annual dividend, D1, to be $2.00 and it expects dividends to grow at a constant rate gL = 4.9%. The firm's current common stock price, P0, is $25.00. If it needs to issue new common stock, the firm will encounter a 4.0% flotation cost, F. Assume that the cost of equity calculated without the flotation adjustment is 12.9% and the cost of old common equity is 12.4%. What is the flotation cost adjustment that must be added to its cost of retained earnings? Do not round intermediate calculations. Round your answer to two decimal places. % What is the cost of new common equity considering the estimate made from the three estimation methodologies? Do not round intermediate calculations. Round your answer to two decimal places. %ART has come out with a new and improved product. As a result, the firm projects an ROE of 27%, and it will maintain a plowback ratio of 0.30. Its earnings this year will be $4.0 per share. Investors expect a 16% rate of return on the stock. What price do you expect ART shares to sell for in 4 years? a) $44.77 b) $83.15 c) $48.40 d) $52.40
- Weber Integrated Systems Inc. is expected to pay a year-end dividend of $0.90 per share (i.e. D1 = $0.90), and that dividend is expected to grow at a constant rate of 4.00% per year in the future. The company's beta is 1.20, the market risk premium is 5.00 %, and the risk - free rate is 4.00 % . What is the company's current stock price? a. $15.00 b. $15.60 c. $16.33 d. $17.77 e. $ 18.20A financial analyst estimates that the current risk-free rate for NN company is 6.25 percent, the market risk premium is 5 percent, and NN's beta is 1.75. The current earnings per share (EPS0) is RM2.50. The company has a 40 percent payout ratio. The analyst estimates that the company's dividend will grow at a rate of 25 percent this year, 20 percent next year, and 15 percent the following year. After three years the dividend is expected to grow at a constant rate of 7 percent a year. The company is expected to maintain its current payout ratio. The analyst believes that the stock is fairly priced. a) What is the required rate of return for the stock? b) What are the dividends for 4 years? c) What is the stock price at the end of year 3?ART has come out with a new and improved product. As a result, the firm projects an ROE of 29%, and it will maintain a plowback ratio of 0.25. Its earnings this year will be $3.0 per share. Investors expect a 13% rate of return on the stock. What price do you expect ART shares to sell for in 4 years? $80.46 $54.77 $51.77 $48.27