Question
An analyst at Apple Securities Co. was recently asked by an investor to advise on the fair value of the US stock price. Please read
An analyst at Apple Securities Co. was recently asked by an investor to advise on the fair value of the US stock price. Please read the information below and report the results of your analysis on investors.
1) Facebook plans to pay annual dividends to investors in one year and two years later. The dividends are $1.23 and $1.25, respectively, and are disclosed on the stock market. Facebook also disclosed that it will continue to pay $1.45 per share on a regular basis after paying dividends due two years later. At present, given that an investor's expected rate of return is 16.4% in the market, what is the fair value of Facebook? However, the calculation should be rounded to the third decimal place.
2) Intel announced its dividend payment plan for the next two years through a recent disclosure. Intel plans to pay $1.50 per share in the next year and $1.68 per share in the next year, according to disclosure data from Intel. Meanwhile, according to forecast data from renowned US analysts, the average annual growth rate of the industry in which Intel belongs is presented at 3.4%. If the investor's expected return is 13.7% in the current stock market, what should be the fair value of Intel? However, the calculation should be rounded to the third decimal place.
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