Valuation of Preferred Stock Beart Inc. issued preferred stock with a par value of $100 and an annual dividend rate of 8%. What is the value of this stock if the required return is a b. C. d 12% What relationship do you see between price and required return?

Preferred Stock Rate of Return Nick's Enchiladas has preferred stock outstanding that pays a dividend of $4 at the end of each year. The preferred sells for $30 a share. What is the stock's required rate of return (assume the market is in equilibrium with the required return equal to the expected return)? Round the answer to two decimal places.

Preferred Stock Rate of Return Nick's Enchiladas has preferred stock outstanding that pays a dividend of $3 at the end of each year. The preferred sells for $60 a share. What is the stock's required rate of return (assume the market is in equilibrium with the required return equal to the expected return)? Round the answer to two decimal places.   %

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Consolidated Industries' preferred stock pays an annual dividend of $4.80 . If investors require a return of 18.5%, what price should the preferred stock sell for?   Question 14 options:   $25.95   $24.91   $28.02   $22.83   $29.58

Use the following tables to assess the worthiness of Verticon stock as an investment. Verticon Stock Data (Current and Historical) 3:45PM EDT Aug 16, 2011 Price 18.85 USD Change  +0.64 (+3.51%) Mkt cap 147.1B Div/yield 0.20/4.24 Shares 8,012 Beta 0.70 Book/share 11.335 EPS 1.11     12/2010 12/2009 12/2008 (Millions of Dollars) Total Assets 195,014 195,949 111,148 Total Liabilities 107,201 122,935 53,592 Preferred Shareholders’ Equity 52 61 73 Common Shareholders’ Equity 87,761 72,953 57,483 Shares Outstanding 8,012 8,070 6746 Book/Share ? 9.040 8.521     Q1 (Mar ’11) 2010 Net profit margin 15.24% 12.24% Return on equity 11.60% 9.30%   Which one in bold? One of the most important features of a stock is its book value. The book value per share of Verticon’s stock for the year 2010 was equal to (10.954, 13.693, 11.502).      Looking at the (Market cap, EPS, change in price, beta value, ROE) ,…

PART B

Given the following information for the stock of Foster​ Company, calculate the risk premium on its common stock.  ​   Current price per share of common stock ​$47.02   Expected dividend per share next year ​$2.46 Constant annual dividend growth rate 5.9​% ​Risk-free rate of return 3.9​% The risk premium on Foster stock is ___%

Preferred stock valuation Jones Design wishes to estimate the value of its outstanding preferred stock. The preferred issue has a par value of $100 and pays an annual dividend of $6.10 per share. Similar-risk preferred stocks are currently earning an annual rate of return of 7.6%. a. What is the market value of the outstanding preferred stock? b. If an investor purchases the preferred stock at the value calculated in part a, how much does she gain or lose per share if she sells the stock when the required return on similar-risk preferred stocks has risen to 8.8%? ... a. The market value of the outstanding preferred stock is $ per share. (Round to the nearest cent.) b. If the required return on similar-risk preferred stocks has risen to 8.8%, the value of the stock will be $ per share. (Round to the nearest cent.) If an investor purchased the preferred stock at the value calculated in part a and sells the stock when the required return on similar-risk preferred stocks has risen to 8.8%,…

10-7 What is the geometric average return of a stock with the following share price history? Year Share price 1 $20 2 $22 3 $24 4 $26 5 $28 Select one: a. 9.09% b. 8.78% c. 8.33% d. 7.69% e. 6.48%