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JUST NEED ANSWER FOR D The market consensus is that Analog Electronic Corporation has an ROE of 9% and a beta of 2.10. It plans
JUST NEED ANSWER FOR D
The market consensus is that Analog Electronic Corporation has an ROE of 9% and a beta of 2.10. It plans to maintain indefinitely its traditional plowback ratio of 3/4. This year's earnings were $4.1 per share. The annual dividend was just paid. The consensus estimate of the coming year's market return is 13%, and T-bills currently offer a 5% return. Required: a. Find the price at which Analog stock should sell. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Price $ 7.27 b. Calculate the P/E ratio. (Do not round intermediate calculations. Round your answers to 2 decimal places.) P/E ratio Leading 1.66 Trailing 1.77 c. Calculate the present value of growth opportunities. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.) PVGO $ (12.81) d. Suppose your research convinces you Analog will announce momentarily that it will immediately reduce its plowback ratio to 1/4. Find the intrinsic value of the stock. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Intrinsic value of the stockStep by Step Solution
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