Analyze the quarterly dividend growth rate

Reference no: EM1358251

1. Using the Yahoo! Finance website, get the current price and five-year dividend history for Eli Lily & Co. To gather this data, enter the ticker symbol (LLY) in the Get Quotes box at the top of the page and then click the GO button. Record the current price from this page. Now, at the left side of the quotes page, click on the Historical Prices link. To get a table of previous dividends, select the Dividends Only at the top of the table, set the Start Date to five years before today's date, and click the Get Prices button. Click the Download to Spreadsheet link at the bottom of the table to download a file with this data. You should have the choice of either saving the file or opening it directly with Excel. It is easier to let it open in Excel. Otherwise, save the .csv (comma-separated variables) file and then open it with Excel. It shouldn't need any further processing other than some formatting. You now have the dividends in a worksheet.

a. Since LLY pays dividends quarterly, calculate the quarterly percentage change in the dividends. Now, evaluate the compound quarterly growth rate of the dividends using the GEOMEAN function.

b. Now annualize the quarterly dividend growth rate.

c. Calculate the intrinsic value of the stock using a 10% required rate of return and the calculated annual growth rate. Use the sum of the most recent four dividends as D0 (aka "D" sub "zero").

d. How does the calculated intrinsic value compare to the actual market price of the stock? Use an "IF" statement to display whether the stock is undervalued, overvalued, or fairly valued. Would you buy the stock at this price?

Reference no: EM1358251

Questions Cloud

Limitations of using financial statements to make decisions : How are the income statement and statement of cash flows used to make business decisions? What are the advantages and limitations of using them to make decisions affecting the future of a business?

Regional trading blocs and globalization : What are four unpopular issues with globalization for Americans? You must provide examples to support your answer.

Compute unemploymet rate and labor forceparticipation rate : Compute the unemploymet rate and the labor forceparticipation rate,and compare thse raes wth those in the United States in 2009.

Antisocial personality disorder : As a therapist, do you think you would find it difficult to work with clients who display antisocial personality disorder? What about the disorder would you find most difficult?

Analyze the quarterly dividend growth rate : Get the current price and 5-year dividend history for Eli Lily & Corporation To gather this information, enter the ticker symbol (LLY) in the Get Quotes box at the top of the page and then click the GO button.

Draw uml diagram for classes quiz and question : Consider a quiz grading system that grades student responses to quizzes. Draw a UML diagram for classes Quiz, Question, EssayQuestion, MultipleChoiceQuestion, Student, and Submission.

How much power is dissipated in the cord : when 105 mL of water at 22 C is mixed with 68mL of water at 95 C, what is the final temperature? suppose no heat is lost to the surroundings and density of water is 1 g/mL.

Alternative trade: legacies for the future : explain how Alternative Trade: Legacies for the Future supports or challenges your conceptualizations of trade and development. Are there themes that some of you agree upon? Do you disagree on others? Describe your conversation.

Reasons why there is optimism for continued union success : Show the reasons why there is optimism for continued union success and why do employers resist the formation of unions in their companies? Provide at least four reasons.

User Account

All Pages