Amazon equity beta Market risk premium 1.5 5.00% 10-year Treasury 1 Jan 2020 Cost of equity 1.90% Cost of debt 2.00% Shares outstanding 31 Dec 2019 504 million Debt/ (debt + equity) 2.60% Tax rate 17.0% Discount rate (WACC) Growth rate

Amazon equity beta Market risk premium 1.5 5.00% 10-year Treasury 1 Jan 2020 Cost of equity 1.90% Cost of debt 2.00% Shares outstanding 31 Dec 2019 504 million Debt/ (debt + equity) 2.60% Tax rate 17.0% Discount rate (WACC) Growth rate

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

Problem 1PS

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Net profit: 85000€ Retained earnings (profit) 31.12.2020: 24.000€Regular Reserve 31.12.2020: 30.000€ Share Capital 31.12.2020: 125.000€ the approved interim dividend for the year 2021 is €20,000, which is due on 31.12.2021 Prepare the Statement of Changes in Equity.
B C Inputs for GE Year Dividend Div growth Term value Investor CF beta 1.1 2017 1.04 1.04 mkt prem 0.08 2018 1.23 1.23 rf 0.025 2019 1.41 1.41 k_equity term gwth 0.1130 2020 1.60 1.60 0.060 2021 1.85 0.1544 1.85 2022 2.11 0.1450 2.11 2023 2.40 0.1355 2.40 2024 2.70 0.1261 2.70 2025 3.02 0.1166 3.02 2026 3.34 0.1072 3.34 Value line 2027 3.67 0.0978 3.67 forecasts of 2028 3.99 0.0883 3.99 annual dividends 2029 4.31 0.0789 4.31 2030 4.61 0.0694 4.61 2031 4.89 0.0600 4.89 Transitional period 2032 5.18 0.0600 103.57 108.75 with slowing dividend growth 35.70 PV of CF Beginning of constant growth period E17 (1+F17)/(B5 -F17) NPV(B5,H2:H17) Problem 18-15 Calculate the intrinsic value of GE in each of the following scenarios by using the three-stage growth model of Spreadsheet 18.1. Treat each scenario independently. a. The terminal growth rate will be 9.10%. (Round your answer to 2 decimal places.) O Answer is complete but not entirely correct. Intrinsic value 63.34 O E.
Faux Corp Stock Over the Last 10 years - Beta = 1.1 - Market Risk premium = 10% - Current risk-free rate 3% - Last dividend $5 - Current Stock Price $30 Dividend History 2016 - $4.20 2017 - $4.40 2018 - $4.55 2019 - $4.75 2020 - $5.00 1. Calculate the cost of equity using SML
Calculate the intrinsic value of Rio Tinto in each of the following scenarios by using the three-stage growth model of Spreadsheet 18.1. Treat each scenario independently. a. The terminal growth rate will be 10.30%. (Round your answer to 2 decimal places.) Intrinsic value b. Rio Tinto's actual beta is 1.05. (Round your answer to 2 decimal places.) Intrinsic value c. The market risk premium is 9.50%. (Round your answer to 2 decimal places.) Intrinsic value
YearEPSDividendChange 20130.75 20140.78 20150.81 20160.82 20170.85 20180.90 Payout Ratio:30% Required Rate of Return: 10% Current Stock Price P0:$5.00 1) Dividend amount in 2013: 2) Dividend CAGR: 3) 2019 Dividend: 4) Intrinsic value: 5) Compared to P0: 6) Required rate of return (solver or goal seek): The following table contains the six-year EPS history for Corporation X. The dividend payout ratio is 30%. 1) What is the dividend amount paid in 2013? 2) What is the compound growth rate (CAGR) of the dividend based on the dividend paid from 2013 - 2018? 3) Assume dividend is growing at the the compound growth rate of the dividend in 2019, what is the dividend per share paid in 2019? 4) Use dividend constant growth model, calculate the intrinsic value of the stock using a 10% required rate of return. 5) How does the calculated intrinsic value compare to the current stock price of $5? Use IF statement. 6) Use the Goal Seek or Solver option to find the required rate…
What is the estimated cost of common equity using the DCF approach given the data below? Price $50 Current dividend $4.19 Constant growth rate 5%
Faux Corp Stock Over the Last 10 years - Beta = 1.1 - Market Risk premium = 10% - Current risk-free rate 3% - Last dividend $5 - Current Stock Price $30 Dividend History 2016 - $4.20 2017 - $4.40 2018 - $4.55 2019 - $4.75 2020 - $5.00 Dividend Growth Rate = 17.83% 1. Calculate the Cost of Equity using DGM
Question 31: An analyst has assembled the following information regarding Net-Zone Incorporated and the market in general: Net-Zone dividend (paid yesterday) $2.15 per share Net-Zone expected dividend growth 3% per year Net-Zone expected ROE 16.2% Net-Zone beta 1.8 Net Zone long-term bond yield 8.6% 10.7% Expected return on S&P 500 Index 30-day Treasury bill yield 10-year Treasury bond yield 3.5% 4.8% When reviewing the data provided by the analyst, the CFO of Net-Zone was surprised by the value of the company's beta. The CFO understands that the beta value is an indicator of risk, and investors need to be compensated for their risk of investing. The company's current stock price is just under $17 per share, which the CFO believes is too low considering the company's increased profit margins. If the CFO believes the stock price should be no less than $25 per share, and assuming the CFO is correct, that would imply that the company's beta is a) 1.22 b) 1.19 c) 1.13 d) 1.16
2020 reported NOPAT $10,500 million 2020 reported NOA 62,200 million Present value of forecast horizon FCFF 42,800 million Present value of terminal period FCFF 229,900 million Net nonoperating obligations 18,800 million If Toppin has 2 billion shares of common stock outstanding, what is the value of a share of stock at the end of 2020 estimated using the discounted cash flow model? O $126.95 O $163.30 $167.45 O $176.85 O $158.05
usiness: BUQU 1130: Business Mathematics Page 137 6. [HW] A $25,000, 10% bond redeemable at par on Dec 1, 2028, is purchased on September 25, 2017, to yield 7.6^ compounded semi-annually. Bond interest is payable semi-annually. a) What is the cash price of the bond? b) What is the accrued interest? c) What is the purchase price?
Year The following return series comes from Global Financial Data. Large Stocks LT Gov Bonds US T-bills CPI (Rf asset) (inflation) 2017 21.83% 6.24% 0.80% 2.07% 2018 -5.28% -1.25% 1.81% 2.10% 2019 25.45% 3.35% 2.15% 1.10% 2020 18.16% 10.25% 4.50% 1.88% 2021 2022 28.70% -19.78% -1.54% 0.40% 7.00% -8.55% 2.20% 6.50% Calculate the average real return earned on US T-bills. (Enter percentages as decimals and round to 4 decimals)
Estimate the Cost of Capital for Company XYZ based on the information below. $50.00 $1.60 Stock price: Dividend: Beta: 1.29 Shares outstanding: 5-year dividend growth: 100,000,000 7.55% Risk-free rate: 0.60% Market risk premium: 7.00% Debt Information (bonds outstanding) Book Value "Quoted Price" Maturity YTM $800,000,000 3/15/2025 4.0% 99.00 $200,000,000 2/1/2027 4.5% 130.00 $500,000,000 9/1/2042 5.0% 95.00 $900,000,000 10/15/2044 5.5% 90.00

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