Business, 27.08.2020 14:01 shalcarter2001

ABC Corp. has just paid a dividend of $0.26. ABC has an annual required return of 12%. a. If dividends are annual and expected to be constant, what is the intrinsic value (fair price) of ABC stock?
b. What is ABC's dividend yield?
c. From now on, assume that the dividend of 0.26 was a quarterly dividend. What is the quarterly discount rate?
d. What is the intrinsic value if dividends are constant and quarterly?
e. We now think that dividends will grow by 0.3% from quarter to quarter. The firm just paid the quarterly dividend of 0.26. What is the intrinsic value of ABC stock?
f. A different analyst thinks that ABC's dividends will grow by 5% for the next 4 quarters, and then grow by 0.3% thereafter. What is the intrinsic value?

Answers: 1

Show answers

Another question on Business

Business, 22.06.2019 03:20

The treasurer for pittsburgh iron works wishes to use financial futures to hedge her interest rate exposure. she will sell five treasury futures contracts at $139,000 per contract. it is july and the contracts must be closed out in december of this year. long-term interest rates are currently 7.30 percent. if they increase to 9.50 percent, assume the value of the contracts will go down by 20 percent. also if interest rates do increase by 2.2 percent, assume the firm will have additional interest expense on its business loans and other commitments of $149,000. this expense, of course, will be separate from the futures contracts. a. what will be the profit or loss on the futures contract if interest rates increase to 9.50 percent by december when the contract is closed out

Answers: 1

Answer

Business, 22.06.2019 04:40

How long have u been on dis website

Answers: 2

Answer

Business, 22.06.2019 11:00

The following transactions occurred during july: received $1,000 cash for services provided to a customer during july. received $4,000 cash investment from bob johnson, the owner of the business received $850 from a customer in partial payment of his account receivable which arose from sales in june. provided services to a customer on credit, $475. borrowed $7,000 from the bank by signing a promissory note. received $1,350 cash from a customer for services to be rendered next year. what was the amount of revenue for july?

Answers: 1

Answer

Business, 22.06.2019 11:10

Use the information below to answer the following question. the boxwood company sells blankets for $60 each. the following was taken from the inventory records during may. the company had no beginning inventory on may 1. date blankets units cost may 3 purchase 5 $20 10 sale 3 17 purchase 10 $24 20 sale 6 23 sale 3 30 purchase 10 $30 assuming that the company uses the perpetual inventory system, determine the gross profit for the month of may using the lifo cost method.

Answers: 1

Answer

You know the right answer?

ABC Corp. has just paid a dividend of $0.26. ABC has an annual required return of 12%. a. If divide...

Questions