The analyst who supplied you with the information in Problem 1 has just revised her forecast. She

Question:

The analyst who supplied you with the information in Problem 1 has just revised her forecast. She now realizes that the growth rate of 10% can continue for only five years, after which the company will have a long-term growth rate of 6%. Furthermore, at the end of the five years, she expects the company's payout rate to increase from its present 30% up to 50%. What value would you assign to the company?
In Problem 1
A firm has just paid (the moment before valuation) a of 55¢ and is expected to exhibit a growth rate of 10% into the indefinite future. If the appropriate is 14%.
Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...