Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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- 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…arrow_forwardCommon stock value: Constant growth Seagate Technology is a global leader in data storage solutions and a high-yield dividend payer. From 2015 through 2019, Seagate paid the followingper-share dividends: Year Dividend per share 2019 $2.51 2018 $2.27 2017 $1.83 2016 $1.16 2015 $1.49 Assume that the historical annual growth rate of Seagate dividends is an accurate estimate of the future constant annual dividend growth rate. Use a 19% required rate of return to find the value of Seagate's stock immediately after it paid its 2019 dividend of $2.51.arrow_forwardConstant Dividend Growth Valuation Boehm Incorporated is expected to pay a $2.60 per share dividend at the end of this year (i.e., D1 = $2.60). The dividend is expected to grow at a constant rate of 10% a year. The required rate of return on the stock, rs, is 18%. What is the estimated value per share of Boehm's stock? Do not round intermediate calculations. Round your answer to the nearest cent.arrow_forward
- Constant Dividend Growth Valuation Boehm Incorporated is expected to pay a $2.20 per share dividend at the end of this year (i.e., D1 = $2.20). The dividend is expected to grow at a constant rate of 8% 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.arrow_forwardCommon stock value: Constant growth The common stock of Barr Labs Ic., trades for $119 per share. Investors expect the company to pay a(n) $1.37 dividend next year, and they expect that dividend to grow at a constant rate forever. If investors require a(n) 13.5% retun on this stock, what is the dividend growth rate that they are anticipating? The anticipated dividend growth rate is %. (Round to two decimal places.) Теxt lia Librai 1 Calculat r Resource Enter your answer in the answer box and then click Check Answer. nic Study ies All parts showing Clear All Check Answer munication Tools > Brief a This rourse (lntrocuctio Zutter/SmartDriocic 11:38 PM (? Type here to search 3/24/2021 insert 8. + backspace hom 3. 4 6 WE R H. K enter A pause CV M alt ctrl alt USE YOUR SMARTPHONE FOR の Reviews your turn. *Videos Features Specs 可 ミ1S1arrow_forwardNeed answervarrow_forward
- Hello tutor I want answer of this Question and I want this in text Format.arrow_forwardCommon stock value: Constant growth Seagate Technology is a global leader in data storage solutions and consistent dividend payer. From 2018 through 2022, Seagate paid the following per-share dividends: Year Dividend per share 2022 2021 2020 2019 2018 $2.56 2.22 1.88 1.19 1.56 Assume that the historical annual growth rate of Seagate dividends is an accurate estimate of the future constant annual dividend growth rate. Use a 20% required rate of return to find the value of Seagate's stock immediately after it paid its 2022 dividend of $2.56. The value of Seagate's stock is $. (Round to the nearest cent.)arrow_forwardTwo growth model Determine the intrinsic value of an equity share, given the following data: Last dividend (Do) - Rs 2.00 Growth rate for the next five years - 15 percent Growth rate beyond 5 years - 10 percent Assume a required rate of returnarrow_forward
- Common stock value-Constant growth Use the constant-growth model (Gordon growth model) to find the value of the firm shown in the following table: (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Dividend expected next year $1.06 The value of the firm's stock is $ Dividend growth rate 7.3% (Round to the nearest cent.) Required return 11.9%arrow_forwardSaved Help Save & Exit Expected Return A company's current stock price is $85.50 and it is likely to pay a $4.50 dividend next year. Since analysts estimate the company will have a 12% growth rate, what is its expected return? Multiple Choicearrow_forward4. Kindly answerarrow_forward
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