Calculate the value of the following two stocks: Acorn Tech and Lime Media. Acorn has reported earnings per share of 80p and has a dividend payout of 40% and the dividend has just been paid. Acorns weighted average cost of capital is 9% and they have 25% debt in their capital structure. The tax rate is 30%. Acorns dividends are growing at 4% per year. Lime has grown its dividend steadily over the years. In 2010 was 8p and in 2020 it was 19p. The company faced a tax rate of 30% as well, the risk-free rate of interest is 2% and the market risk premium is 6%. Lime has no debt and its beta is 1.8. Its payout ratio is lower at 30%. What are the share prices of Acorn and Lime?

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5. Calculate the value of the following two stocks: Acorn Tech and Lime Media. Acorn has reported earnings per share of 80p and has a dividend payout of 40% and the dividend has just been paid. Acorn's weighted average cost of capital is 9% and they have 25% debt in their capital structure. The tax rate is 30%. Acorn's dividends are growing at 4% per year. Lime has grown its dividend steadily over the years. In 2010 was 8p and in 2020 it was 19p. The company faced a tax rate of 30% as well, the risk-free rate of interest is 2% and the market risk premium is 6%. Lime has no debt and its beta is 1.8. Its payout ratio is lower at 30%. What are the share prices of Acorn and Lime