Question
The following forecasts of earnings per share (EPS) and dividend per share (DPS) were made at the end of 2009: (See picture for numbers) The
The following forecasts of earnings per share (EPS) and dividend per share (DPS) were made at the end of 2009:
(See picture for numbers)
The firm has an equity cost of capital of 12 percent per annum.
a)Calculate the abnormal earnings growth that is forecast for each year, 2011 to 2014.
b)What is the per share value of the equity at the end of 2009 based on the abnormal earnings growth model?
What is the expected trailing P/E for 2014?
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Accounting
Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett
9th edition
1118608224, 1118608227, 730323994, 9780730323990, 730319172, 9780730319177, 978-1118608227
