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You have been assigned to analyze Suncoast Inc. You have estimated that Suncoast's earnings and dividends will grow at a constant rate of 13% in
You have been assigned to analyze Suncoast Inc. You have estimated that Suncoast's earnings and dividends will grow at a constant rate of 13% in the future and the required rate of return is 14%. You have the following information: 2019 2020 Net income in millions) Dividends in millions) Common shares outstanding in millions) 60 18 84 80 24 84 Based on the information, calculate the trailing and forward P/E for Suncoast. You are valuing the stock of a company. You are confident projecting earnings and dividends to three years. You have the following estimates and information: Required rate of return = 9% Average dividend payout ratio for similar companies = 45% Industry average ROE = 10% Estimated earnings in year three = $3.00 Industry average P/E = 12 . A. Compute the terminal value (V3) in year three based on comparables. an estimate of terminal value based on the B. Contrast your answer in part A constant growth model. You have been assigned to analyze Suncoast Inc. You have estimated that Suncoast's earnings and dividends will grow at a constant rate of 13% in the future and the required rate of return is 14%. You have the following information: 2019 2020 Net income in millions) Dividends in millions) Common shares outstanding in millions) 60 18 84 80 24 84 Based on the information, calculate the trailing and forward P/E for Suncoast. You are valuing the stock of a company. You are confident projecting earnings and dividends to three years. You have the following estimates and information: Required rate of return = 9% Average dividend payout ratio for similar companies = 45% Industry average ROE = 10% Estimated earnings in year three = $3.00 Industry average P/E = 12 . A. Compute the terminal value (V3) in year three based on comparables. an estimate of terminal value based on the B. Contrast your answer in part A constant growth model
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