Estimate for halliford stock

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Halliford Corporation expects to have earnings this coming year of $2.846 per share. Halliford plans to retain all of its earnings for the next two years' Then, for the subsequent two years, the ?rm will retain 54% of its earnings. It will retain 18% of its earnings from that point onward, Each year, retained earnings will be invested in new projects with an expected return of 24.5% per year. Any earnings that are not retained will be paid out as dividends' Assume Halliford's share count remains constant and all eamings growth comes from the investment of retained eamingst If Halliford's equity cost of capital is 8.4%, what price would you estimate for Halliford stock?

Reference no: EM133074236

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