Video Excel Activity: Nonconstant Growth and Corporate Valuation Taussig Technologies Corporation (TTC) has been growing at a rate of 25% per year in recent years. This same growth rate is expected to last for another 2 years, then decline to gn = 5%. The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. Do not round intermediate calculations. X Download spreadsheet Nonconstant Growth and Corporate Valuation-afc098.xlsx a. If Do = $1.30 and rs = 8%, what is TTC's stock worth today? Round your answer to the nearest cent. $ per share What are its expected dividend, and capital gains yields at this time, that is, during Year 1? Round your answers to two decimal places. Dividend yield: Capital gains yield: % % b. Now assume that TTC's period of supernormal growth is to last for 5 years rather than 2 years. How would this affect the price, dividend yield, and capital gains yield? Round your answer for the price to the nearest cent and for the dividend yield and capital gains yield to two decimal places. The price will to $ per share.

Video Excel Activity: Nonconstant Growth and Corporate Valuation Taussig Technologies Corporation (TTC) has been growing at a rate of 25% per year in recent years. This same growth rate is expected to last for another 2 years, then decline to gn = 5%. The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. Do not round intermediate calculations. X Download spreadsheet Nonconstant Growth and Corporate Valuation-afc098.xlsx a. If Do = $1.30 and rs = 8%, what is TTC's stock worth today? Round your answer to the nearest cent. $ per share What are its expected dividend, and capital gains yields at this time, that is, during Year 1? Round your answers to two decimal places. Dividend yield: Capital gains yield: % % b. Now assume that TTC's period of supernormal growth is to last for 5 years rather than 2 years. How would this affect the price, dividend yield, and capital gains yield? Round your answer for the price to the nearest cent and for the dividend yield and capital gains yield to two decimal places. The price will to $ per share.

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Description: VideoExcel Activity: Nonconstant Growth and Corporate ValuationTaussig Technologies Corporation (TTC) has been growing at a rate of 25% per year in recent years. This same growth rate is expected to last for another 2years, then decline to gn = 5%.T

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter15: Ratio Analysis (ratioa)

Section: Chapter Questions

Problem 6R: With the 2013 data still on the screen, click the Chart sheet tab. The chart presented shows the...

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Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Risk-free Return Year 2007 2008 2% 1% Print Market Return 7% -30% Done XYZ Return 9% - 39% - X
With the 2013 data still on the screen, click the Chart sheet tab. The chart presented shows the rates of return for Global Technology for the last five years. Answer the following questions: a. In 2009, the rate of return on assets exceeded the rate of return on common stockholders equity. Why might this have occurred? Be as specific as possible. b. Is the company better off in 2013 than it was in 2009? Why or why not? When the assignment is complete, close the file without saving it again. Worksheet. Modify the RATIOA4 worksheet to have it compute two additional activity ratios: number of days sales in receivables and number of days sales in merchandise inventory. Use the 2012 and 2013 data and assume a 365-day year. Write out the formulas for your ratios in the spaces provided. Days sales in receivables (average collection period) ________________ Days sales in inventory (average sales period) ________________ Preview the printout to make sure that the worksheet will print neatly, and then print the worksheet. Save the completed file as RATIOAT. Chart. Using the RATIOA4 file, prepare a column chart that compares the acid test and current ratios for Global Technology for 2012 and 2013. Complete the Chart Tickler Data Table and use it as a basis for preparing the chart. Enter all appropriate titles, legends, and formats. Enter your name somewhere on the chart. Save the file again as RATIOA4. Print the chart.
Start with the partial model in the file Ch07 P25 Build a Model.xlsx on the textbook’s Web site. Selected data for the Derby Corporation are shown here. Use the data to answer the following questions.a. Calculate the estimated horizon value (i.e., the value of operations at the end of the forecast period immediately after the Year-4 free cash flow). Assume growth becomes constant after Year 3.b. Calculate the present value of the horizon value, the present value of the free cash flows, and the estimated Year-0 value of operations. c. Calculate the estimated Year-0 price per share of common equity. INPUTS (In Millions) YearCurrent Projected0 1 2 3 4Free cash flow −$20.0 $20.0 $80.0 $84.0Marketable securities $40Notes payable $100Long-term bonds $300Preferred stock $50WACC 9.00%Number of shares of stock 40
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ClapTrap is a rapidly growing image messaging company. The company's growth strategy requires rapid reinvestment currently, with dividend payouts increasing as growth opportunities gradually disappear. You have the following financial information about ClapTrap: Earnings in the most recently concluded fiscal year were $$6.286.28. The company will retain all its earnings this year (from t=00 to t=11 ), reinvesting in new projects with a return on new investment of 44.044.0%. The next year (from t=11 to t=22 ), the company will retain 85.085.0% of its earnings. Return on new investment is expected to be 30.030.0%. In the following year (from t=22 to t=33 ), the company will retain 69.069.0% of its earnings with an expected return on new investment of 20.020.0%. The company will then enter a period of stable growth, retaining 49.049.0% of its earnings in perpetuity. a) What are the expected dividends per share for each period from t=11 to t=33 ? The expected dividends per share for…
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