You have been hired by Shovein Asset Management Co to be an equity analyst Your job is to value the following company and ultimately issue a BUY HOLD SELL recommendation for our clients COMPANY DATA Current Stock Price $40 00 Number of Outstanding Shares 50,000 Total Assets $10,000,000 Total Equity $7,000,000 Last Dividend Paid share $1 50 Forecasted Growth Rate (after yr 5) 3 0 Tax Rate 30 Required Rate (WACC) 8 0 You have forecasted certain Income Statement and Balance Sheet information for the next 5 years Year 1 Year 2 Year 3 Year 4 Year 5 Sales $1,000,000 $1,100,000 $1,250,000 $1,400,000 $1,600,000 Operating Costs (excl Dep ) $600,000 $660,000 $750,000 $840,000 $960,000 Depreciation Expense $150,000 $160,000 $175,000 $190,000 $200,000 Capital Expenditures $175,000 $175,000 $200,000 $200,000 $220,000 Increase in Current Assets $20,000 $25,000 $30,000 $40,000 $50,000 Increase in Current Liabilities $15,000 $15,000 $20,000 $20,000 $30,000 What is your valuation using the Dividend Growth Model What is your valuation using the DCF Model

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You have been hired by Shovein Asset Management Co  to be an equity analyst  Your job is to value the following company and ultimately issue a BUY   HOLD   SELL recommendation for our clients  COMPANY DATA  Current Stock Price   $40 00 Number of Outstanding Shares   50,000 Total Assets   $10,000,000 Total Equity   $7,000,000 Last Dividend Paid   share   $1 50 Forecasted Growth Rate (after yr  5)   3 0  Tax Rate   30  Required Rate (WACC)   8 0  You have forecasted certain Income Statement and Balance Sheet information for the next 5 years  Year 1 Year 2 Year 3 Year 4 Year 5 Sales $1,000,000 $1,100,000 $1,250,000 $1,400,000 $1,600,000 Operating Costs (excl  Dep ) $600,000 $660,000 $750,000 $840,000 $960,000 Depreciation Expense $150,000 $160,000 $175,000 $190,000 $200,000 Capital Expenditures $175,000 $175,000 $200,000 $200,000 $220,000 Increase in Current Assets $20,000 $25,000 $30,000 $40,000 $50,000 Increase in Current Liabilities $15,000 $15,000 $20,000 $20,000 $30,000 What is your valuation using the Dividend Growth Model  What is your valuation using the DCF Model

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You have been hired by Shovein Asset Management Co. to be an equity analyst. Your job is to value the following company and ultimately issue

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You have been hired by Shovein Asset Management Co. to be an equity analyst. Your job is to value
the following company and ultimately issue a BUY / HOLD / SELL recommendation for our clients.

COMPANY DATA:
Current Stock Price =	$40.00		Number of Outstanding Shares =		50,000
Total Assets =	$10,000,000		Total Equity =		$7,000,000
Last Dividend Paid / share =	$1.50		Forecasted Growth Rate (after yr. 5) =		3.0%
Tax Rate =	30%
Required Rate (WACC) =	8.0%



You have forecasted certain Income Statement and Balance Sheet information for the next 5 years:
	Year 1	Year 2	Year 3	Year 4	Year 5
Sales	$1,000,000	$1,100,000	$1,250,000	$1,400,000	$1,600,000
Operating Costs (excl. Dep.)	$600,000	$660,000	$750,000	$840,000	$960,000
Depreciation Expense	$150,000	$160,000	$175,000	$190,000	$200,000

Capital Expenditures	$175,000	$175,000	$200,000	$200,000	$220,000
Increase in Current Assets	$20,000	$25,000	$30,000	$40,000	$50,000
Increase in Current Liabilities	$15,000	$15,000	$20,000	$20,000	$30,000


What is your valuation using the Dividend Growth Model?


What is your valuation using the DCF Model?