Assuming ferrell price and earnings ratio remains

Assignment Help Financial Management
Reference no: EM131818186

Ferrell Inc. recently reported net income of $8 million. It has 680,000 shares of common stock, which currently trades at $25 a share. Ferrell continues to expand and anticipates that 1 year from now, its net income will be $13.6 million. Over the next year, it also anticipates issuing an additional 68,000 shares of stock so that 1 year from now it will have 748,000 shares of common stock. Assuming Ferrell's price/earnings ratio remains at its current level, what will be its stock price 1 year from now? Do not round intermediate calculations. Round your answer to the nearest cent.

Reference no: EM131818186

Questions Cloud

What is the current account generally composed : Of what is the current account generally composed? Why does the exchange rate not always adjust to a current account deficit?
Calculate the price of share of the company common stock : Calculate the price of share of the company common stock
Describe the two quantitative variables of interest : Describe the two quantitative variables of interest, and tell which is explanatory and which is response.
Review a serial killer from the us in the last 50 years : Review a serial killer from the U.S. in the last 50 years that has been or was diagnosed with one of the personality disorders described in the chapter.
Assuming ferrell price and earnings ratio remains : Assuming Ferrell's price/earnings ratio remains at its current level, what will be its stock price 1 year from now?
Antipredator behaviour of male iberian rock lizards : "Sources of Individual Shy-Bold Variations in Antipredator Behaviour of Male Iberian Rock Lizards" explored the relationship between lizards' physical
What is edelman market and book ratio : It has 700 million shares of common stock outstanding, and its stock price is $48 per share. What is Edelman's market/book ratio?
Determine variable factory overhead controllable variance : Determine the variable factory overhead Controllable Variance, fixed factory overhead volume variance, and total factory overhead cost variance
Problems can arise between managers and stockholders : Potential agency problems can arise between managers and stockholders,

Reviews

Write a Review

Financial Management Questions & Answers

  Corporation has gross income from operations

Fisafolia Corporation has gross income from operations of $220,000 and operating expenses of $160,000 for the current year.

  Sensitivity analysis assesses the risk of a project

In investment appraisal, sensitivity analysis assesses the risk of a project by:

  Decides to institute cost-cutting measures

The Company's financial statements for year 2525 show that year-end Total assets of $5, 425 include Plant, property, & equipment (PP&E) of $4,000 the assets are financed by Current liabilities of $1, 205, Debt of $1, 520 and Stockholders' equity of $..

  Compare level of capital spending across the two firms

Kristin Malone opened Kristin's Maids Cleaning Service on July 1, 2017. During July, the company completed the following transactions. July 1 Stockholders invested $14,000 cash in the business in exchange for common stock. compare the level of capita..

  According to constant growth dividend discount model

According to constant growth dividend discount model, we compute the intrinsic value of stock at time 0 (today’s computed stock price), P0=D1/(k-g), where D1 is the expected dividend next year, and k is the required return or discount rate.

  What was the firms 2012 operating cash flow or ocf

The 2011 balance sheet of Anna's Tennis Shop, Inc., showed long-term debt of $6.4 million,-What was the firm's 2012 operating cash flow, or OCF?

  What is cost of common equity

Percy Motors has a target capital structure of 45% debt and 55% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 12%, and its tax rate is 40%. Percy's CFO estimates that the company's WACC is 14.50%...

  What is fat builders sustainable growth rate

What is the present value of Invitro Masters’ growth opportunities? What is Fat Builders’ sustainable growth rate?

  What are stated and expected yields to maturity of the bonds

What are the stated and expected yields to maturity of the bonds? The bond makes its coupon payments annually.

  Prepare a business report for the board of directors

Accounting and Decision Making - Prepare a business report for the Board of Directors providing analysis and business advice

  Determine whether a long or short hedge is appropriate

For each of the following situations, determine whether a long or short hedge is appropriate.

  Ensure reduction in asymmetric information between parties

The public and private sector have taken many steps to ensure the reduction in asymmetric information between parties (lender-borrower, investor-issuer).

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd