What is the holding- period return for a share which cost £4.50, was held for a year and then sold for £6.20, and which paid a dividend at the end of the holding period of 20p?
Q: If the required return is 12 percent and the company just paid a dividend of $2.80, what is the…
A: Share Price: It represents the current market value to buyers and to the seller. The share price…
Q: BMM Industries pays a dividend of $2.20 per quarter. The dividend yield on its stock is reported at…
A: Information Provided: Dividend per quarter = $2.20 Dividend Yield = 5.00%
Q: SSS Limited paid a dividend of ₱434 per share last year. If yesterday’s last price was ₱4,650, what…
A: The dividend yield is the rate or percentage of the dividend that is paid to the shareholders
Q: What is the rate of return when 15 shares of Stock A, purchased for $30/share, are sold for $500?…
A: Purchase Price = $30 per share * 15 Shares = $450 Net Income = Sale Price -…
Q: A property holding declared a dividend of 12 pesos per share for the common stock. If the common…
A: Formula: Stock yield ratio = Dividend per share / Current market price of the common stock
Q: National Corporation expects to pay a dividend of P5 per share at the end of year one, P9 per share…
A: The most latest price at which a security was sold on an exchange is the current price. Buyers and…
Q: Assume Evco, Inc. has a curent stock price of $47.26 and will pay a $2.25 dividend in one year: its…
A: Stock Price: The price of a stock represents the current value of a buyer and seller with respect…
Q: A stock sells for $40 per share and pays a one-time dividend for the full year of $.75. One year…
A: Holding period is defined as the total amount that a person earns for keeping an assets for a period…
Q: You purchased a stock at a price of $46.06. The stock paid a dividend of $1.47 per share and the…
A: Purchase price (P0) = $ 46.06 Dividend (D1)= $ 1.47 Price at year end (P1) = $ 50.56
Q: What is the dividend yield on Stock A that sells at $15/share, when Company A pays a quarterly…
A: Dividend yield is calculated as dividend amount received as a percentage of current share price.
Q: If current price of stock is $25 and you hold it for one year and received dividend of $2.5. You…
A: The dividend yield shows how much a company pays out in dividends each year with respect to the…
Q: What is the rate of return when 25 shares of Stock A, purchased for $30/share, are sold for $825?…
A: Rate of return is the amount which defined total income or loss earned over a specific period of…
Q: The market value of the stock of shine corporation at the beginning of year one is 120 per share at…
A: Income = 24 End of period value = 130 Initial value = 120
Q: What should you pay for a stock assuming you expect the following: a dividend of $1.00 paid at the…
A: Information Provided Cost of equity = 8% Dividend (both years) = $1 Selling price = $31
Q: t is expected that ABC Ltd earnings will remain unchanged in the future. The company’s share price…
A: The dividend is the amount in terms of return that is paid to the shareholders from the net income.
Q: An investor buys a stock on margin. Assume that Interest on the loan and the dividend are both paid…
A: Holding period return- It is the return on an asset over the whole period during which it was held.…
Q: A share that can be purchased for $1,173.70 will pay a quarterly dividend in perpetuity at the rate…
A: Dividend is an additional amount paid by the company to the shareholders as a return. It is an…
Q: A share very recently paid a dividend of $4.00. If the dividend is expected to grow at an annual…
A: Given details are : Recent dividend (D0) = $4 Growth rate (g) = 5% Required rate of return (r) = 15%…
Q: Farley Inc. has perpetual preferred stock outstanding that sells for $30 a share and pays a dividend…
A: Required rate of return is the minimum or expected rate of return which is necessary based on the…
Q: share of stock will pay a dividend of $25 in one year, and will be sold fon rice of $500 at that…
A: Share price: Share price is the current market price of the share. It is the price of the share at…
Q: e of a share is currently $14, and you expect the marke ed 1-year holding-period return on Xyrong…
A: Given information : Risk free rate (Rf) = 5.5%Expected market return (Rm) =13%Beta (β) = 2.9…
Q: A company is currently paying a divinded of Ksh 2.00 pr share. The dividend is expected to grow at a…
A: Current Dividend(D0) =2.00 Growth Rate (g) =15% for 3 years thereafter Growth Rate (g) =10% for 3…
Q: What is the dividend yield on Stock A that sells at $15/share, when Company A pays a quarterly…
A: Annual dividend yield is the dividend return on share price in the form of percentage.
Q: At the beginning of last year, the stock price for ABC Company was $20 per share. ABC Company paid a…
A: Annual return = ( Market price + Dividend - initieal price ) / Initial price
Q: Perferred Stock valuation. Stock that sells for $30.00 a share and pays dividend of $2.75 at the end…
A: Formula:
Q: You purchase Griffin ltd at $46.00 per share intend to hold it for a year and hope to sell, it at…
A: The rate of return that an investor is expected to earn from the investment is term as the expected…
Q: A stock is bought for $21.00 and sold for $27.50 one year later, immediately after it has paid a…
A: Capital gain only considers the change in value of share price. Capital gain rate = Selling…
Q: Diana Ltd. paid a $2.5 per share dividend yesterday. The dividend is expected to grow at 10% per…
A: Using dividend discount model
Q: What is the dividend paid to a stockholder who has 100 shares of stocks that pays an annual dividend…
A: The dividend is paid for outstanding shares from the retained earnings of the business.
Q: After a 3-for-1 stock split, Tyler Company paid a dividend of $0.70 per new share, which represents…
A: Stock Split = 3 for 1 New Share dividend = 0.70 increase in pre split dividend = 6% Before split…
Q: age holding period return for a share which is held for six months and sold for OMR 16.75. The…
A: Given, Buying price = OMR 8.50 Selling Price = OMR 16.75
Q: Compute the gains or loss of the investment of C for 100 shares with par value of P5 at the…
A: "As in the question, nothing is mentioned regarding dividend payment, therefore we are assuming that…
Q: Based on a company’s P5.00 dividend payments and estimated future value of P200.00 per share after…
A: Let the growth rate = g Let Dn be the dividend in year n. D0 = P 5 D1 = 5(1+g) D2 = 5(1+g)^2 P0 =…
Q: A share is expected to pay a dividend of $4.00. If the dividend is expected to grow at an annual…
A: Following details are given in the question: Expected dividend (D1) = $4 Growth rate (g) = 5% = 0.05…
Q: Suppose that the preference shares has a liquidation value of P1,300 and dividends are n arrears for…
A: Book value per share (BVPS) is the ratio of equity available to ordinary shareholders is divided by…
Q: Assume that a company's beginning-b per share, and its end-of-period price is $10.50 per common…
A: (Note: We’ll answer the M12-20 question since it was specified. Please submit a new question…
Q: SSS Limited paid a dividend of ₱434 per share last If yesterday’s last price was ₱4,650, what is…
A: Dividend= 434 current price= 4650
Q: The following information relates to the acquisition of M plc by D plc: Recent dividend of M…
A: The Dividend Growth Model refers to a model that helps in calculating the intrinsic value of a stock…
Q: Assuming that the preference share capital of Love Company are non-cumulative and that Love Company…
A: Non-cumulative preference shares are those shares that provide the shareholder fixed dividend amount…
Q: ains or loss of the investment of C for 100 shares with par value of P5 at the beginning of the…
A: Loss or gains are realized when you purchase and sell shares in the market.
Q: What is the dividend yield on Stock A that sells at $20/share, when Company A pays a quarterly…
A: The dividend yield is a financial metric that represents the proportion of dividend paid out by the…
Q: The preferred stock of Hose Ltd., pays an annual dividend of Shs.6.50 a share and sells for shs.48 a…
A: Annual Dividend= Shs.6.50 Current share Price= Shs.48 Cost of the preferred stock=?
Q: After a 5-for-l stock split, Tyler Company paid a dividend of $1.15 per newshare, which represents a…
A: Dividend per share is the income of the investors who have purchased equity shares of an entity.…
Q: If a security offers a dividend amounting to P 5.23/ share and an investor purchased 200 shares at P…
A:
Q: ABC Inc. share will pay dividends of 40 for the first year, 45 for the second year, and 3% above the…
A: Dividend in year 1 (D1) = 40 Dividend in year 2 (D2) = 45 Growth rate (g) = 3% Required return (r) =…
Q: Company A will pay a dividend at the end of each year at 150Php for the next 3 years for Stock A…
A: Share price: Share price is the current market price of the share. It is the price of the share at…
Q: Lala Ltd's stock is currently selling for $5 per share. Lala Ltd paid $0.5 dividend and has growth…
A: The dividend yield is a financial ratio (dividend/price) that shows how much a company pays out in…
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- Assume the risk-free rate is 4% and the beta for a particular firm is 2, current firm share price is $35 and the market risk premium is 8%. A.Given the risk level, what is the one-year required rate of return (we will call this k)? B.If next year’s expected dividend is $3, use k from part A to solve for the expected next year’s price.Suppose that you have estimated the CAPM betas for the equity shares of the following two firms: Levi Strauss & Co. ( NYSE: LEVI): \beta ^ LEVI = 1.10 Tesla Inc. (Nasdaq: TSLA) : \beta ^ TSLA = 1.90 Assume that the risk - free rate is estimated at 4%, stable over the entire CAPM estimation period, and will remain in the foreseeable future. Answer questions a) and b) below. (Lecture notes p.12, pp.15-17) Suppose the expected return on S&P 500 index, a proxy for the market portfolio, is estimated at 17%. Find the CAPM required returns on equity shares of Levi's and Tesla, respectively. Answer (show the steps/calculation toward your results): Suppose the market risk premium is estimated at 9%. Find the CAPM required returns on equity shares of Levi's and Tesla, respectively. Answer (show the steps/calculation toward your results):a) Firm A has systematic risk beta and ROE (return on equity) equal 0.8 and 7% respectively. The risk-free rate is 3% and the market risk premium is 6%. If firm A's next year EPS (earnings per share) and DPS (dividend per share) are £0.5 and £0.2 respectively, what is the firm's expected price-earnings multiple? How much dividend should the firm declare if it is to enjoy a higher expected PE (price-to-earnings) valuation? b) What are the pros and cons of the PE approach to valuation?
- b) You are given the following information about Stock X and the market: The annual effective risk-frec rate is 5%. The expected return and volatility for Stock X and the market are shown in the table below: Expected Return Volatility Stock X 5% 40% Market 8% 25% The correlation between the returns of stock X and the market is -0.25. Assume the Capital Asset Pricing Model holds. Calculate the required return for Stock X and determine if the investor should invest in Stock X.Thecovarianceofthemarket'sreturnwithaStockA'sreturnis0.003andthestandarddeviation of the market's return is 0.05. Stock A's beta is ________. The risk free rate is 6% and the expected market return is 15%. Stock A's current price is $25 and will pay a $1 dividend at the end of the year. If the stock is priced at $30 at year-end, it is _______. a) 1.2; underpriced, so buy it. b) 1.5; underpriced, so buy it. c) I .2; overpriced, so sell it. d) 1.5; overpriced, so sell it. e) None of the aboveYou have assigned the following values to these three firms: Upcoming Dividend $0.50 Estee Lauder Kimco Realty Nordstrom Price $36.00 75.00 11.00 1.58 2.00 Estee Lauder required return Kimco Realty required return Nordstrom required return Assume that the market portfolio will earn 17.20 percent and the risk-free rate is 8.20 percent. Compute the required return for each company using both CAPM and the constant-growth model. (Do not round intermediate calculations and round your final answers to 2 decimal places.) CAPM Growth 11.40% 17.00 8.80 % % % Beta 0.92 1.28 1.24 Constant-Growth Model % % %
- 2 (CAPM and expected returns) a. Given the following holding-period returns, compute the average returns and the standard deviations for the Zemin Corporation and for the market. b. If Zemin's beta is 0.83 and the risk-free rate is 9 percent, what would be an expected return for an investor owning Zemin? (Note: Because the preceding returns are based on monthly data, you will need to annualize the returns to make them comparable with the risk-free rate. For simplicity, you can convert from monthly to yearly returns by multiplying the average monthly returns by 12.) c. How does Zemin's historical average return compare with the return you believe you should expect based on the capital asset pricing model and the firm's systematic risk? a. Given the holding-period returns shown in the table, the average monthly return for the Zemin Corporation is %. (Round to two decimal places.) The standard deviation for the Zemin Corporation is %. (Round to two decimal places.) Given the…You live in a world where assets are priced by the CAPM. The following information is given to you regarding stock X. The expected payoff from the stock X=£105.00 Expected return of stock X = 18% Risk-free rate =5% Market Risk Premium = 9% Assume there are no other changes, except that the correlation between the returns of Stock X and the market becomes twice what it is currently. How would this change affect the current price of Stock X? Explain why the change of the correlation causes the observed change in the stock price. [hint: Provide a risk-based explanation]Consider the following security: Applegate Aeronautical, Incorporated Earnings Per Share, Next Year $2.50 Dividend Payout Rate 0.400 Return on Equity 0.150 Beta 1.250 Market Data Market Risk Premium 0.075 Risk-free Rate 0.025 Required: Using the information in the tables above, please calculate the dividend per share, the retained earnings, and the intrinsic value of this stock. (Use cells A5 to B12 from the given information to complete this question.) Applegate Aeronautical, Incorporated Market Capitalization Rate Dividends per share (Next Year) Sustainable Growth Rate Intrinsic Value
- The DestitutusVentis Company (DV Co) has the following items on its balance sheet (question mark means that the quantity is unknown): Type of asset/liability Market value Risk (beta) Cash holdings £20m 0 Fixed investments £180m ? Short term debt £10m 0 Long term debt £70m 0.05 Equity £120m 1.1 The risk-free rate is 3%, and the average return on the market index is 7%. The number of shares outstanding for DV Co is 100m. The corporate and investor tax rates are zero. Modigliani-Miller irrelevance of dividend policy and capital structure holds. What is the weighted average cost of capital (WACC) for DV Co? The company plans to pay a dividend per share of £0.10, which is funded by increasing the company’s long-term debt correspondingly. The new debt has the same beta as the old long-term debt. What is the value per share of the DV Co’s stock on ex-dividend day if the dividend payment goes ahead? What is the beta of the equity on…Assume the risk-free rate is 2.5% and the market risk premium is 8.0%. The beta of GE is 1.10. The dividend forecast for the next four years is as follows: 2017: $1.04 2018: $1.22 2019: $1.41 2020: $1.60 Using the dividend payout ratio (53%) and Return on Equity (19.5%), what is closest to the intrinsic value of GE stock using the dividend discount model? Question 9 options: a) $53.40 b) $140.00 c) $97.98 d) $75.83Assume the risk free rate is 4% and the beta for a particular firm is 2, current firm share price is $35 and the market risk premium is 8%. Given the risk level what is the one year required rate of return (we will call this k)? If next year’s expected dividend is $3, use k from part A to solve for the expected next year’s price.