Question
1. Deployment Specialists pays a current (annual) dividend of $1 and is expected to grow at 20% for two years and then at 4% thereafter.
1. Deployment Specialists pays a current (annual) dividend of $1 and is expected to grow at 20% for two years and then at 4% thereafter. If the required return for Deployment Specialists is 8.5%, what is the intrinsic value of Deployment Specialists stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
2. Jand, Inc., currently pays a dividend of $1.22, which is expected to grow indefinitely at 5%. If the current value of Jands shares based on the constant-growth dividend discount model is $32.03, what is the required rate of return? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
3. Tri-coat Paints has a current market value of $41 per share with earnings of $3.64. What is the present value of its growth opportunities (PVGO) if the required return is 9%? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
4.
The market capitalization rate for Admiral Motors Company is 8%. Its expected ROE is 10% and its expected EPS is $5. If the firms plowback ratio is 60%,
a. Calculate the growth rate. b. what will be its P/E ratio? |
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