Y8 Dividend oneDividend twoDividend threeDividend fourDividend growth rateRequired returnOutput area:Year1234$LA LA LA LAShare pricePrice after Year 4 dividend$$15.0011.009.002.954%10.30%Cash flow

Name: Y8 Dividend oneDividend twoDividend threeDividend fourDividend growth
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Description: Y8 Dividend oneDividend twoDividend threeDividend fourDividend growth rateRequired returnOutput area:Year1234$LA LA LA LAShare pricePrice after Year 4 dividend$$15.0011.009.002.954%10.30%Cash flow

Price of the stock is the PV of all future dividends and horizon value discounted at the required…

Answered: Price after Year 4 dividend Year 1 234…

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Finance

Price after Year 4 dividend Year 1 234 2 4 Share price Cash flow

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter15: Capital Investment Analysis

Section: Chapter Questions

Problem 15.1.2MBA

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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…
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