Expected dividend growth rate and discount rate

Assignment Help Financial Management
Reference no: EM131045544

Trust Bankers just paid an annual dividend of $1.8 per share. The expected dividend growth rate is 6.2 percent, the discount rate is 11 percent, and the dividends will last for 4 more years. What is the value of the stock?

Reference no: EM131045544

Questions Cloud

What can you conclude about the research hypothesis : STAT6000Health Research Methods. Assuming the assumptions for the statistical test you chose to do are met, what can you conclude about the research hypothesis after you run the statistical analyses
Compare a filtering firewall to a proxy firewall : Assume a configuration as in Figure 8.21, where the internal host under attack trusts the remote company user.
Develop a comprehensive listing of all research sites : Create a forum in which you illustrate your research. Write an essay using the above research and analysis - 500 words. Develop a comprehensive listing of all research sites.
Non-profit organization to establish human resources plan : Imagine you are a consultant working with a start-up non-profit organization to establish their Human Resources plan. What does the plan look like and why? What are some challenges in the current workforce that you are likely to face, and should c..
Expected dividend growth rate and discount rate : Trust Bankers just paid an annual dividend of $1.8 per share. The expected dividend growth rate is 6.2 percent, the discount rate is 11 percent, and the dividends will last for 4 more years. What is the value of the stock?
Design integration and testing : Q1. Describe the products that typically result from the following project stages: Project Start-up; Analysis of Requirements; Design Integration and Testing.
In order to fund her retirement : In order to fund her retirement, Michele requires a portfolio with an expected return of 0.11 per year over the next 30 years. She has decided to invest in Stocks 1, 2, and 3, with 25 percent in Stock 1, 50 percent in Stock 2, and 25 percent in Stock..
Question regarding the communication effectiveness : 1) What are Yogesh Gupta and Kathleen Murphy doing to reduce the "noise" in their communications? Discuss. 2) Which of the nine personal barriers to communication are being addressed by Gupta and Murphy? Explain your rationale. 3) How might Gupta and..
Employee relations reasons or tax reasons : KPI continues to do well and the KPI’s employees are pretty happy with the retirement plan that was adopted. You stay in touch with Jenny by helping her out with questions on the retirement plan when they come up and doing some of her tax compliance ..

Reviews

Write a Review

Financial Management Questions & Answers

  Domain powers allowing for a taking of land for a public use

The government's eminent domain powers allowing for a taking of land for a public use. What is meant by a public use? Is the taking of land for development of a shopping mall considered a public use? How did the U.S. Supreme Court analyze the notion ..

  About the current share price

Lohn Corporation is expected to pay the following dividends over the next four years: $17, $13, $12, and $7.50. Afterward, the company pledges to maintain a constant 5 percent growth rate in dividends forever. If the required return on the stock is 1..

  According to the capital asset pricing model

Security X has an expected rate of return of 17% and a beta of 1.65. The risk-free rate is 4% and the market expected rate of return is 13%. According to the capital asset pricing model, security X has an expected return of ______________%. It is fai..

  Compute the optimal capital budget

The cost of debt for firm XYZ is 6%. Its tax rate is 40%. The cost of retained earnings is 12% and the cost of external common equity is 14%. Retained earnings are $5000. The target capital structure calls for 45% debt and 55% equity. Compute the opt..

  After the dividend is paid-farrah owns

Farrah owns 5,000 shares of stock in DAS, Inc. with a market value of $15,000.DAS declares a 20% stock dividend. After the dividend is paid, Farrah owns

  Annual pretax cost savings

Purple Haze Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $540,000 is estimated to result in $225,000 in annual pretax cost savings. The press falls in the MACRS five-year class, ..

  Used for the common stock in the computation of Team WACC

Team Sports has 6 million shares of common stock outstanding, 1 million shares of preferred stock outstanding, and 200 thousand bonds ($1,000 par). If the common shares are selling for $24.50 per share, the preferred share are selling for $20 per sha..

  Number of bracelets that need to be sold to earn profit

Sonicmony Soft, makes designer gold bracelets. Its annual costs include shop rent of $15,000, salaries for two jewellers of $125,000, design software costs of $12,000, and other overhead costs of $15,000. An average bracelet is priced at $6,500. It c..

  Make semiannual payments-what is the current bond price

App Store Co. issued 15-year bonds one year ago at a coupon rate of 7.1 percent. The bonds make semiannual payments. If the YTM on these bonds is 5.4 percent, what is the current bond price?

  Construction project-raising all of debt now-single issue

"To finance its on going construction project, Bowen-Roth Inc. will need $5,000,000 of new capital during each of the next 3 years. The firm has a choice of issuing new debt or equity each year as the funds are needed, or issue only debt now and equi..

  Offered a job with an unusual bonus structure

You have been offered a job with an unusual bonus structure. As long as you stay with the firm, you will get an extra $73,000 every seven years, starting seven years from now. What is the present value of this incentive if you plan to work for the co..

  About what happens to the price of the treasury bond

JP Morgan Chase & Co. bank plans on taking a position in Treasury bond futures contracts, which currently have a quote of 105. JP Morgan Chase & Co. bank expects the interest rates to increase over the period of the investment. (The investment in T-b..

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