Apple has just paid a quarterlydividend of $3.03. Dividends areexpected to grow by 10 % for thenext 4 quarters, and then grow by1.6 % thereafter. Apple has arequired quarterly return of 3% .Attempt 1/3 forPart 1What is the expected dividend fourquarters from now? 2. What is theterminal value in the fourth quarter?

The expected dividend four quarters from now is approximately $4.4362.The terminal value in the…

Answered: Apple has just paid a quarterly…

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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Q4. Firm DEF has just paid a quarterly dividend of $3.75. Dividends are expected to grow by 10% for the next 4 quarters, and then grow by 1.4% thereafter. Firm DEF has a required quarterly return of 5%. Show all work for each part of the problem that requires computation. a) What is the expected dividend in four quarters? b) What is the horizon value in the fourth quarter (P4)? c) What is the intrinsic value of the stock today? d) How would you critique the model you used for calculating the intrinsic value? In other words, what are its shortcomings, if any?
Today, Apple paid a $1.50 dividend (it pays dividends semi- annually). Future dividends are expected to grow at the constant rate of 2% per semi- annual period. If the effective semi-annual rate is 6% what is the current stock price of apple? Please show formulas and procedure used. Thanks!
Kroger has just paid a quarterly dividend of $1. Growth this year is expected and dividends are forecasted to grow by 10% for the next 4 quarters, and then by 1.5% thereafter. Kroger has a required quarterly discount rate of 2%. It would likely help to create a timeline below Questions: 1. What is the expected dividend in four quarters? 2. What is the terminal value in Q4 for all dividends Q5 and beyond? 3. What is the current price of the stock according to the DDM (i.e. the PV of all cashflows on this timeline)? Quater 1 2 3 4 5 Dividend ? ? ? ? ?
Whizcom Inc. is expected to pay a dividend of $1 next period. Dividends are expected to grow at 2% per year and the investors require a return of 12%. i) Compute the current stock price for Whizcom Inc.ii) What would be the likely stock price in year 5?iii) What would be per annum rate of return implied by a change in prices from time 0 to time 5?
A firm pays a $13.80 dividend at the end of year one (D1), has a stock price of $149, and a constant growth rate (g) of 5 percent. Compute the required rate of return (Ke). (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)
Whizcom Inc. is expected to pay a dividend of $1 next period. Dividends are expected to grow at 2% per year and the investors require a return of 12%. a) What would be the likely stock price in year 5? b) What would be per annum rate of return implied by a change in prices from time 0 to time 5?
An issue of common stock is selling for $58.20. The year-end dividend is expected to be $2.55, assuming a constant growth rate of 5%. What is the required rate of return? (Round your answer to 1 decimal place.) Multiple Choice O O 8.9 9.4 9.9 11.4
Show Detailed Steps When Solving The Following Question: Gordon Growth Company is expected to pay a dividend of $4 next period, and dividends are expected to grow at 6% per year. The required return is 16%. What is the current price? What is the price expected to be in year 4?
ABCâ€™s lastdividend paid was $0.4, its required return is 13.3%, its growth rate is 7%,and its growth rate is expected to be constant in the future. What isSorenson’s expected stock price in 7 years, i.e., what is P7?Note: Enter your answer rounded off to two decimal points.Do not enter $ or comma in the answer box. For example, if your answer is$12.345 then enter as 12.35 in the answer box.
Give your answer as a percentage, accurate to three decimal places.Your stock account value falls by 9.5% this year. What percentage gain do you need next year in order to: break even? % have a total of 10% growth? % average 10% growth per year?
Global Logistics just announced it is increasing its annual dividend to $1.46 next year and will increase that dividend by 2.11 percent annually thereafter. How much will one share of this stock be worth ten years from now if the required rate of return is 13.1 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
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