Al's Infrared Sandwich Company had a book value of $18.00 at the beginning of the year, and the earnings per share for the past year was $7.41. Molly Miller, a research analyst at Miller, Moore & Associates, estimates that the book value and earnings per share will grow at 18.50 and 17.00 percent per year for the next four years, respectively. After four years, the growth rate is expected to be 6 percent. Molly believes the required return for the company is 10.60 percent. What is the value per share for Al's Infrared Sandwich Company? Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
Al's Infrared Sandwich Company had a book value of $18.00 at the beginning of the year, and the earnings per share for the past year was $7.41. Molly Miller, a research analyst at Miller, Moore & Associates, estimates that the book value and earnings per share will grow at 18.50 and 17.00 percent per year for the next four years, respectively. After four years, the growth rate is expected to be 6 percent. Molly believes the required return for the company is 10.60 percent. What is the value per share for Al's Infrared Sandwich Company? Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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