Chapter 9 Stock Valuation at Ragan Engines Input area: Shares owned by each sibling Ragan EPS...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Chapter 9 Stock Valuation at Ragan Engines Input area: Shares owned by each sibling Ragan EPS Dividend to each sibling Ragan ROE Ragan required return Blue Ribband Motors Corp. Bon Voyage Marine, Inc. Nautilus Marine Engines Industry average Nautilus EPS w/o write-off LA LA $ $ $ 150,000 5.35 320,000 21% 18% EPS 1.19 $ 1.26 (0.27) 0.73 $ 2.07 DPS 0.19 $ 0.55 0.57 0.44 $ Stock price 16.32 13.94 23.97 18.08 ROE 10.00% 12.00% N/A 11.00% R 12.00% 17.00% 16.00% 15.00% Output area: 1) Total earnings Payout ratio Retention ratio Growth rate Total dividends next year Total equity value Value per share 2) Industry EPS Industry payout ratio Industry retention ratio Industry growth rate Year 1 2 3 4 5 6 Stock value in Year 5 Total stock value today Value per share 3) Industry PE Ragan PE (original assumption) | Ragan PE (revised assumption) Stock price implied by industry PE 4) Total earnings Cash cow value Percentage not attributable to growth opportunities 5) ROE Percentage attributable to growth opportunities Total dividends ||||| Chapter 9 Stock Valuation at Ragan Engines Input area: Shares owned by each sibling Ragan EPS Dividend to each sibling Ragan ROE Ragan required return Blue Ribband Motors Corp. Bon Voyage Marine, Inc. Nautilus Marine Engines Industry average Nautilus EPS w/o write-off LA LA $ $ $ 150,000 5.35 320,000 21% 18% EPS 1.19 $ 1.26 (0.27) 0.73 $ 2.07 DPS 0.19 $ 0.55 0.57 0.44 $ Stock price 16.32 13.94 23.97 18.08 ROE 10.00% 12.00% N/A 11.00% R 12.00% 17.00% 16.00% 15.00% Output area: 1) Total earnings Payout ratio Retention ratio Growth rate Total dividends next year Total equity value Value per share 2) Industry EPS Industry payout ratio Industry retention ratio Industry growth rate Year 1 2 3 4 5 6 Stock value in Year 5 Total stock value today Value per share 3) Industry PE Ragan PE (original assumption) | Ragan PE (revised assumption) Stock price implied by industry PE 4) Total earnings Cash cow value Percentage not attributable to growth opportunities 5) ROE Percentage attributable to growth opportunities Total dividends |||||
Expert Answer:
Answer rating: 100% (QA)
The only point to be noted here is that for Nautilus the EPS of 207 should be taken ie without the w... View the full answer
Related Book For
Principles of Auditing and Other Assurance Services
ISBN: 978-0078025617
19th edition
Authors: Ray Whittington, Kurt Pany
Posted Date:
Students also viewed these finance questions
-
A charged particle moves uniformly with velocity v along a circle of radius R in the plane xy (Fig. 4.40). An observer is located on the x axis at a point P which is removed from the centre of the...
-
Because specialists such as Chick Gandil are charged with maintaining a "fair and orderly" market, at times they will be required to sell when others are buying and buy when others are selling. How...
-
Cultural values can be classified as affecting one of three types of relationshipsother, environment, or self. Describe each of these, and differentiate each one from the others.
-
Determine the force in members HI, FI, and EF of the truss, and state if the members are in tension orcompression. 3 m D. -2 m--2 m2 m--2 m--2 m--2 m- 4 kN 5 KN 6 kN 8 kN
-
Describe why the recognition of revenue for IRU swaps for fiber-optic assets that were not actually needed by Qwest is inappropriate under GAAP. As an auditor, what type of evidence would allow you...
-
Suppose the people in a room are divided into two groups as follows: Members: 15 men, 20 women, 0 children Nonmembers: 10 men, 8 women, 12 children A prize is given to one person who is selected at...
-
The accounts of Cascade Consulting, Inc., follow with their normal balances at December 31, 2010. The accounts are listed in no particular order. Requirements 1. Prepare the companys trial balance at...
-
Milden Company is a distributor who wants to start using a contribution format income statement for planning purposes. The company has analyzed its expenses and developed the following cost formulas:...
-
B-4 (10 Marks) Please consider each of the following parts independently. Part 1 (3 marks) The Money Tree Investment Fund has a total investment of $450 million in five stocks: Stock Investment ($...
-
Pathfinder College is a small liberal arts college that wants to improve its admissions process. In particular, too many of its incoming freshmen have failed to graduate for a variety of reasons,...
-
malia bought 4 bonds of Reebox Company (11 3/4 28) at 88.25. Assuming a commission of $4 per bond, how much interest will malia recieve from the bonds after one year
-
A lake with a fixed carrying capacity contains a certain fish population. The fish population in the lake has a growth rate that is proportional to its size when the population is very small relative...
-
Now that we know about data, we continue our journey with 2 fundamental descriptive statistics that help us understand fundamental components of a data set. In this week's discussion, we are going to...
-
Imagine that, as an HRM professional, you have been contracted to institute a training program on customer relations within an organization. You request to see the organization's latest needs...
-
Calculate the followings based on the followings information Fixed Cost EBITDA Break Even Income Statement/cash flow COGS $ COGS% GP $ GM% Variable Cost$ Contribution margin$ Contribution margin%...
-
A small plane flies a distance d 1 = 34 km in a direction 1 = 52 o north of east and then flies d 2 = 28 km in a direction 2 = 14 o north of east. 1. What is the magnitude of the net displacement...
-
How do Conceptual artists navigate the tension between the intangible nature of their ideas and the necessity of material representation in order to communicate their conceptual concepts effectively ?
-
Do the three planes x + 2x + x 3 = 4, X X 3 = 1, and x + 3x = 0 have at least one common point of intersection? Explain.
-
Should a separate audit program be prepared for each audit engagement, or can a standard program be used for most engagements?
-
Do auditors usually begin their consideration of internal control over IT activities with a review of general or application control activities? Explain.
-
Multiple Choice Questions a. Analysis of which account is least likely to reveal evidence relating to recorded retirement of equipment? (1) Accumulated depreciation. (2) Insurance expense. (3)...
-
The gross profit ratio is equal to: (a) profit divided by net sales. (b) cost of sales divided by net sales. (c) net sales minus cost of sales, divided by net sales. (d) net sales minus cost of...
-
What inventory cost flow method does Dominos Pizza Enterprises Ltd use for its inventories?
-
Which inventory cost flow method produces the highest profit in a period of rising prices?
Study smarter with the SolutionInn App