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Please help with last two questions. Choices are: Total --------- of ------------ 1 loss/profit 2 15600.00, 24000.00, 28800.00, 18,000.00 Portman Industries just paid a dividend
Please help with last two questions. Choices are:
Total --------- of ------------
1 loss/profit
2 15600.00, 24000.00, 28800.00, 18,000.00
Portman Industries just paid a dividend of $3.60 per share. The company expects the coming year to be very profitable, and its dividend is expected to grow by 12.00% over the next year. After the next year, though, Portman's dividend is expected to grow at a constant rate of 2.40% per year. The risk-free rate (PRF) is 3.00%, the market risk premium (RPM) is 3.60%, and Portman's beta is 1.00. Term Dividends one year from now (D1) Horizon value (P1) Intrinsic value of Portman's stock Value $4.0320 $98.30 $95.99 Assuming that the market is in equilibrium, use the information just given to complete the table. What is the expected dividend yield for Portman's stock today? 4.20% 0 3.36% 04.10% 4.37% Now let's apply the results of your calculations to the following situation: Portman has 1,000,000 shares outstanding, and Judy Davis, an investor, holds 15,000 shares at the current price (computed above). Suppose Portman is considering issuing 125,000 new shares at a price of $81.59 per share. If the new shares are sold to outside investors, by how much will Judy's investment in Portman Industries be diluted on a per-share basis? $1.36 per share $1.97 per share $1.60 per share $3.36 per share O O Thus, Judy's investment will be diluted, and Judy will experience a totalStep by Step Solution
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