Compute the dividends over the next five years

Assignment Help Financial Management

Reference no: EM132008475

Suppose that a firm's recent earnings per share and dividend per share are $3.60 and $2.60, respectively.

Both are expected to grow at 8 percent. However, the firm's current P/E ratio of 17 seems high for this growth rate.

The P/E ratio is expected to fall to 13 within five years. Compute the dividends over the next five years.

Reference no: EM132008475

Questions Cloud

The investor would receive a current yield equal to : Suppose that Ford issues a coupon bonds at a price of $1,000, which is the same as the bond's par value.

How much in the april income statement : In the March income statement, how much revenue is recognized on the March income statement from this order? How much in the April Income statement

Explain ten typical business documents : List and briefly explain ten typical business documents (egTax Invoice) commonly used across an organisation in various departments

What effect would it have on next years earnings : What effect would a $10.15 million operating expense have on this year's earnings? What effect would it have on next year's earnings?

Compute the dividends over the next five years : Suppose that a firm's recent earnings per share and dividend per share are $3.60 and $2.60, respectively.

Compute the value of acme common stock : Compute the value of Acme Common Stock if the next dividend is expected to be $1.20 per share. Investors require a 9% rate of return on stocks

At what price would the bonds sell : Suppose Ford Motor Co. sold an issue of bonds with a 10-year maturity, $1,000 par value, and 10% coupon rate.

What will be digby book value : Next year they expect Assets to increase by $4,000,000 and Liabilities to decrease by $2,000,000. If that happens, what will be Digby's book value

What is the yield to maturity of the bond : Suppose the following bond quotes for IOU Corporation appear in the financial page of today's newspaper.

User Account

All Pages