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2. The following table contains information about four different companies, including the estimated next year's EPS, payout ratio, shareholders' required rate of return, and
2. The following table contains information about four different companies, including the estimated next year's EPS, payout ratio, shareholders' required rate of return, and return on equity (ROE): EPS Payout Ratio Firm A Firm B Firm C Firm D $0.80 $1.15. $1.47 $1.85 30% 50% 60% 40% 12% 11% 12% 14% Required rate of Return ROE 16.00% 15.00% 14.00% 16.00% Calculate each company's future earnings growth rate. Using the earnings model, what is the value of the stock? Calculate the value without growth and PVGO separately. See the first and second terms of Equation (1) in the Week 6_Lecture6_1 file.
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