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A. An optimistic forecast for Aluminum demand implies dividends per share for Noranda Bauxite for the next 5 years of: $0 (2021), $0.05 (2022), $0.07
A. An optimistic forecast for Aluminum demand implies dividends per share for Noranda Bauxite for the next 5 years of: $0 (2021), \$0.05 (2022), $0.07 (2023), $0.1 (2024), $0.1 (2025). Due to retired plants in the on the South Coast and tougher regulations with Bauxite Mining in the Cockpit Country you expect a shrinking market from then onwards with falling dividends at 8% p.a. The costs of equity are 10%. What is the fair value of Noranda Bauxite Company? (7 marks) B. An analyst has gathered the following information for the Point C Consultancy: Expected earnings per share =5.70 Expected dividends per share =2.70 Dividends are expected to grow at 2.75 percent per year indefinitely the required rate of return is 8.35 percent
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