At the end of 2016 fiscal year end Piazzo corporation had 300,000 shares of preferred stock outstanding The preferred stock has a book value of $60 per share In addition, piazzo paid $160,000 in dividends to preferred shareholders in 2016 Piazzo also has $8800000 of interest bearing debt outstanding and its after tax cost of debt is 4 4 The market value of Piazzo corporations 900,000 common shares outstanding at year end is $37800000 and the companys cost of common equity is 9 2 Piazzo paid $2 60 dividend in 2016 Analyst expect Piazzo to increase its dividend payout by 6 annually over the long term Piazzo reported net income of $2800000 in 2016 The average PE ratio in Piazzo industry is 15 2 on a trailing basis Piazzo had a net profit margin of 9 7 and an EBITDA margin of 28 8 in 2016 Calculate the value pizzao stock using the dividend discount model (DDM) Round to the nearest dollar What can you conclude abou the companies implied value from the DDM compared to its current market price What is Piazzo PE ratio Conclude on the companys PE ratio relative to its peers and describe what might account for the difference Calculate the companys EV EBITDA multiple What is the total book value of piazzo corporations preferred stock at the end of 2016 Estimate the cost of piazzo corporations preferred equity capital 18 (16 points) At the end of its 2016 fiscal year end Piazzo Corporation had 300,000 shares of preferred stock outstanding The preferred stock has a book value of $60 per share In addition, Piazzo paid $160,000 in dividends to preferred shareholders in 2016 Piazzo also has $8,800,000 of interest bearing debt outstanding and its after tax cost of debt is 4 4 The market value of Piazzo Corporation's 900,000 common shares outstanding at year end is $37,800,000 and the company's cost of common equity is 9 2 Pazzo paid a $2 60 dividend in 2016 Analysts expect Pazzo to increase its dividend payout by 6 annually over the long term Piazzo reported net income of $2,800,000 in 2016 The average PE ratio in Piazzo' industry is 15 2 on a trailing basis Pazzo had a net profit margin of 9 7 and an EBITDA margin of 28 8 in 2016 Required a Calculate the value of Piazzo stock using the dividend discount model (DDM) Round to the nearest dollar What can you conclude about the Company's implied value from the DDM compared to its current market price b What is Piazzo' PE ratio c Conclude on the Company's PE ratio relative to its peers and describe what might d Calculate the Company's EV EBITDA multiple e What is the total book value of Piazzo Corporation's preferred stock at the end of 2016 f Estimate the cost of Piazzo Corporation's preferred equity capital account for the difference

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At the end of 2016 fiscal year-end Piazzo corporation had 300,000 shares of preferred stock outstanding. The preferred stock has a book value of $60

At the end of 2016 fiscal year-end Piazzo corporation had 300,000 shares of preferred stock outstanding. The preferred stock has a book value of $60 per share. In addition, piazzo paid $160,000 in dividends to preferred shareholders in 2016. Piazzo also has $8800000 of interest bearing debt outstanding and its after-tax cost of debt is 4.4%. The market value of Piazzo corporations 900,000 common shares outstanding at year end is $37800000 and the companys cost of common equity is 9.2%. Piazzo paid $2.60 dividend in 2016. Analyst expect Piazzo to increase its dividend payout by 6% annually over the long term. Piazzo reported net income of $2800000 in 2016. The average PE ratio in Piazzo industry is 15.2 on a trailing basis. Piazzo had a net profit margin of 9.7% and an EBITDA margin of 28.8% in 2016.

Calculate the value pizzao stock using the dividend discount model (DDM). Round to the nearest dollar. What can you conclude abou the companies implied value from the DDM compared to its current market price?

What is Piazzo PE ratio?

Conclude on the companys PE ratio relative to its peers and describe what might account for the difference.

Calculate the companys EV / EBITDA multiple

What is the total book value of piazzo corporations preferred stock at the end of 2016?

Estimate the cost of piazzo corporations preferred equity capital.

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18. (16 points) At the end of its 2016 fiscal year-end Piazzo Corporation had 300,000 shares of preferred stock outstanding. The preferred stock has a book value of $60 per share. In addition, Piazzo paid $160,000 in dividends to preferred shareholders in 2016. Piazzo also has $8,800,000 of interest bearing debt outstanding and its after-tax cost of debt is 4.4%. The market value of Piazzo Corporation's 900,000 common shares outstanding at year end is $37,800,000 and the company's cost of common equity is 9.2%. Pazzo paid a $2.60 dividend in 2016. Analysts expect Pazzo to increase its dividend payout by 6% annually over the long term. Piazzo reported net income of $2,800,000 in 2016. The average PE ratio in Piazzo' industry is 15.2 on a trailing basis. Pazzo had a net profit margin of 9.7% and an EBITDA margin of 28.8% in 2016. Required: a. Calculate the value of Piazzo stock using the dividend discount model (DDM). Round to the nearest dollar. What can you conclude about the Company's implied value from the DDM compared to its current market price? b. What is Piazzo' PE ratio? c. Conclude on the Company's PE ratio relative to its peers and describe what might d. Calculate the Company's EV / EBITDA multiple. e. What is the total book value of Piazzo Corporation's preferred stock at the end of 2016? f. Estimate the cost of Piazzo Corporation's preferred equity capital. account for the difference