Suppose the risk-free rate (Rf) is 3.64% and an analyst assumes a market risk premium (Rm -
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Suppose the risk-free rate (Rf) is 3.64% and an analyst assumes a market risk premium (Rm - Rf) of 7.50%. Firm A just paid a dividend of $1.05 per share (i.e., DO = 1.05). The analyst estimates the beta of Firm A to be 1.49 and estimates the dividend growth rate to be 4.13% forever. Firm A has 2.2 million shares outstanding. What is the market value of the equity of Firm A?
Related Book For
Finance for Executives Managing for Value Creation
ISBN: 978-0538751346
4th edition
Authors: Gabriel Hawawini, Claude Viallet
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