NORDAM Group, a firm that specializes in the design and manufacturing of aircraft components, has 130 million shares outstanding and analysts expect NORDAM to have eamings of $420 months coming year (1) NORDAM plans to pay out 57% of its eamings in dividends and they expect to use another 15% of their earnings to repurchase shares. NORDAM's equity cost of capital is 10% eamings are expected to grow rate of 3% per year and these payout rates are expected to remain constant. What is the value of one share of NORDAM stock today? OA $33.23 OB. 546.15 OC. $6.92 OD. $26.31 OE $23.26 OF. None of the above answers is within $0.05 of the correct answer

NORDAM Group, a firm that specializes in the design and manufacturing of aircraft components, has 130 million shares outstanding and analysts expect NORDAM to have eamings of $420 months coming year (1) NORDAM plans to pay out 57% of its eamings in dividends and they expect to use another 15% of their earnings to repurchase shares. NORDAM's equity cost of capital is 10% eamings are expected to grow rate of 3% per year and these payout rates are expected to remain constant. What is the value of one share of NORDAM stock today? OA $33.23 OB. 546.15 OC. $6.92 OD. $26.31 OE $23.26 OF. None of the above answers is within $0.05 of the correct answer

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter4: Financial Planning And Forecasting

Section: Chapter Questions

Problem 9P

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NORDAM Group, a firm that specializes in the design and manufacturing of aircraft components, has 130 million shares outstanding and analysts expect NORDAM to have earnings of $460 million this coming year (t-1). NORDAM plans to pay out 55% of its earnings in dividends and they expect to use another 13% of their earnings to repurchase shares. NORDAM's equity cost of capital is 13%. Its earnings are expected to grow at a rate of 3% per year and these payout rates are expected to remain constant. What is the value of one share of NORDAM stock today? OA. $35.38 OB. $18.51 OC. $24.06 OD. $4.60 OE. $19.46 OF. None of the above answers is within $0.05 of the correct answer. ←
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