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Please answer all. thank you!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! DPS calculation 1. Weston Corporation just paid a dividend of $1.5 a share (i.e., D 0 = $1.5). The dividend
Please answer all. thank you!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
DPS calculation 1. Weston Corporation just paid a dividend of $1.5 a share (i.e., D 0 = $1.5). The dividend is expected to grow 8% a year for the next 3 years and then at 3% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places. D1 D2 D3 D4 D5 = = = = = Constant growth valuation 2. Tresnan Brothers is expected to pay a $3.8 per share dividend at the end of the year (i.e., D1 = $3.8). The dividend is expected to grow at a constant rate of 7% a year. The required rate of return on the stock, rs, is 14%. What is the stock's current value per share? Round your answer to two decimal places. Constant growth valuation 3. Holtzman Clothiers' stock currently sells for $37 a share. It just paid a dividend of $4 a share (i.e., D0 = $4). The dividend is expected to grow at a constant rate of 6% a year. A. What stock price is expected 1 year from now? Round your answer to two decimal places. B. What is the required rate of return? Round your answers to two decimal places. Do not round your intermediate calculations. Preferred stock valuation 4. Farley Inc. has perpetual preferred stock outstanding that sells for $34.00 a share and pays a dividend of $5.00 at the end of each year. What is the required rate of return? Round your answer to two decimal places. Preferred stock rate of return 5. What will be the nominal rate of return on a perpetual preferred stock with a $100 par value, a stated dividend of 8% of par, and a current market price of (a) $60.00, (b) $78.00, (c) $116.00, and (d) $145.00? Round your answers to two decimal places. a) b) c) d) Preferred stock valuation 6. Earley Corporation issued perpetual preferred stock with a 11% annual dividend. The stock currently yields 9%, and its par value is $100. a. What is the stock's value? Round your answer to two decimal places. b. Suppose interest rates rise and pull the preferred st ock's yield up to 11%. What is its new market value? Round your answer to two decimal places. Nonconstant growth 7. Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay dividends. However, investors expect Computech to begin paying dividends, beginning with a dividend of $0.50 coming 3 years from today. The dividend should grow rapidly - at a rate of 45% per year - during Years 4 and 5; but after Year 5, growth should be a constant 4% per year. If the required return on Computech is 12%, what is the value of the stock today? Round your answer to the nearest cent. Do not round your intermediate calculations. Nonconstant growth stock valuation Taussig Technologies Corporation (TTC) has been growi ng at a rate of 17% per year in recent years. This same growth rate is expected to last for another 2 years, then decline to g n = 6%. a If D0 = $2.90 and rs = 13.00%, what is TTC's stock worth today? Round your answer to the nearest cent. Do not round your intermediate calculations. What is its expected dividend yield at this time, that is, during Year 1? Round your answer to two decimal places. Do not round your intermediate calculations. What is its capital gains yields at this time, that is, during Year 1? Round your answer to two decimal places. Do not round your intermediate calculations. What will TTC's dividend and capital gains yields be once its pe riod 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 yieldStep by Step Solution
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