Question
Hazel Corporation issued perpetual preferred stock with a par value of $100. The stock pays a a 8% annual dividend. If the required rate of
Hazel Corporation issued perpetual preferred stock with a par value of $100. The stock pays a a 8% annual dividend. If the required rate of return for preferred stock is 11% then what is the stocks value?
$981.82 | |
$137.50 |
$72.73 | |
$266.67 |
Jordan Mining ore reserves are being depleted, its sales are falling, and its costs are rising. The companys earnings and dividends are declining at the constant rate of 3% per year. If the current dividend (D0) is $2 and the required rate of return is 12%, what is the value of Jordans stock?
$13.33 | |
$12.93 |
$11.73 | |
$22.89 |
Which of the following is true for a constant growth stock?
As the growth rate increases the intrinsic value increases as long as the required rate of return is greater than the growth rate. | |
As the growth rate decreases the intrinsic value increases as long as the required rate of return is greater than the growth rate. |
As the current dividend increases the intrinsic value decreases | |
As the current dividend decreases the intrinsic value increases |
Macrotech is expanding rapidly and currently retains all of its earnings and does not pay a dividend. 4 years from today, Macrotech plans to begin paying a dividend of $1 per share and then dividends will increase at a constant rate of 5% per year. If the required rate of return is 12% then what is the intrinsic value of Macrotech stock today?
$14.29 | |
$10.17 |
$8.33 | |
$15.00 |
KTS corporation has $4 million in debt and 2 million shares outstanding. Assume the present value of all future FCF is $10 million. What is the price per share of stock?
$3 | |
$10 |
$2 | |
$5 |
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