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aussig Technologies Corporation (TTC) has been growing at a rate of 20% per year in recent years. This same growth rate is expected to last
aussig Technologies Corporation (TTC) has been growing at a rate of 20% per year in recent years. This same growth rate is expected to last for another 2 'ears, then decline to gn=6% he data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. o not round intermediate calculations. ownload spreadsheet Nonconstant Growth and Corporate Valuation-187f9e.xlsx a. If D0=$1.70 and rs=9%, what is TTC's stock worth today? Round your answer to the nearest cent. \$ per share What are its expected dividend, and capital gains yields at this time, that is, during Year 1 ? Round your answers to two decimal places. Dividend yield: % Capital gains yield: % capital gains yield? Round your answer for the price to the nearest cent and for the dividend yield and capital gains yield to two decimal places. The price will to $ per share. The dividend yield will % The capital gains yield will to c. What will TTC's dividend and capital gains yields be once its period of supernormal growth ends? (Hint: These values will be the same regardless of whether you examine the case of 2 or 5 years of supernormal growth; the calculations are very easy.) Round your answers to two decimal places. Dividend yield: Capital gains yield: d. TTC recently introduced a new line of products that has been wildly successful. On the basis of this success and anticipated future success, the following free cash flows were projected (in millions): After the 10th year, TTC's financial planners anticipate that its free cash flow will grow at a constant rate of 6%. Also, the firm concluded that new product caused the WACC to fall to 8%. The market value of TTC's debt is $1,200 million, it uses no preferred stock, it has zero nonoperating assets; and there are 20 million of common stock outstanding. Use the corporate valuation model to value the stock. Round your answer to the nearest cent. $ per share
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