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#27 127 Suppose the risk-free rate is 2.57% and an analyst assumes a market risk premium of 7.31%. Firm A just paid a dividend of
#27
127 Suppose the risk-free rate is 2.57% and an analyst assumes a market risk premium of 7.31%. Firm A just paid a dividend of $1.08 per share. The analyst estimates the 3 of Firm A to be 1.44 and estimates the dividend growth rate to be 4.37% forever. Firm A has 271.00 million shares outstanding. Firm Bjust paid a dividend of $1.85 per share. The analyst estimates the B of Firm B to be 0.75 and believes that dividends will grow at 2.75% forever. Firm B has 197.00 million shares outstanding. What is the value of Firm A? Submit Answer format: Currency: Round to: 2 decimal places Step by Step Solution
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