An analyst presents you with the following pro forma (in millions of dollars) that gives her forecast of earnings and dividends for 2013-2017. She asks you to value the 1,380 million shares outstanding at the end of 2012, when common stockholders' equity stood at $4,310 million. Required returnfor equity is 10%.

1. Forecast book value, return on common equity (ROCE)(, and residual earnings for each year.
2. Forecast growth rates for book value and residual earnings for each of the years 2014-2017:
3. Calculate the per-share value of the equity. Woyld you call this a Case 1, 2, or 3 valuation? (p.153-155)
4. What is the premium over book value given by your calculations? What is the P/B ratio?
   

An analyst presents you with the following pro forma (in millions of dollars) that gives her forecast of earnings and dividends for 2013-2017. She asks you to value the 1,330 million shares outstanding at the end of 2012, when common stockholders' equity stood at $4,310 million. Required returnfor equity is 10%. 2013E 2014E 2015E 2016E 2017E Earnings 333.0 570.0 599.0 629.0 660.4 Dividends 115.0 160.0 349.0 367.0 335.4 Forecast book value, return on common equity (ROCE)(, and residual earnings for each year. Forecast growth rates for book value and residual earnings for each of the years 20142017: Calculate the pershare value of the equity. Woyld you call this a Case 1, 2, or 3 valuation? (p.153-155)