Its dividend growth rate for the coming year is projected

Assignment Help Financial Management
Reference no: EM132014440

The ReRocker Corporation is expanding rapidly, but its growth rate is slowing. Its dividend growth rate for the coming year is projected at 15.00%. This rate will decline by 3.00 percentage points per year until it reaches the industry average of 3.00%. Once it reaches 3.00%, it will stay there indefinitely. The most recent dividend was $5.00 per share, and the market requires a return of 10.00% per year on investments such as this one. (To clarify, ReRocker makes a payment once per year and the expected dividend one year from today is $5.75 per share.) Based on this information, compute the price per share for ReRocker.

Reference no: EM132014440

Questions Cloud

The last dollar raised to complete the expansion : What is the WACC for the last dollar raised to complete the expansion?
What is evanec cost of new common equity-re : What is Evanec's cost of new common equity, re?
Cost and benefits of limits on size of financial institution : Cost and benefit of requirements to carry contingent capital or similar mechanisms. Cost and benefits of limits on size of financial institutions.
What are at least three current market trends : What are at least three current market trends and how would you take advantage of them for your client?
Its dividend growth rate for the coming year is projected : The ReRocker Corporation is expanding rapidly, but its growth rate is slowing. Its dividend growth rate for the coming year is projected at 15.00%.
Project cash flow from net working capital at time zero : What is the project's cash flow from net working capital at time zero?
How much does marge need to set aside in real terms : How much does Marge need to set aside in real terms at the end of each of the next 38 years to meet her retirement goal?
Compute the value of the stock under the assumptions : Compute the value of the stock under the assumptions that the annual dividend will grow 3.00% per year in perpetuity
Economic value added of proposed new line of energy drinks : Calculate the economic value added of the proposed new line of energy drinks.

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

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