Market believe will be stock price at the end of three years

Assignment Help Financial Management
Reference no: EM131887057

You are considering an investment in Justus Corporation's stock, which is expected to pay a dividend of $2.25 a share at the end of the year (D1 = $2.25) and has a beta of 0.9. The risk-free rate is 3.6%, and the market risk premium is 5.0%. Justus currently sells for $47.00 a share, and its dividend is expected to grow at some constant rate, g. Assuming the market is in equilibrium, what does the market believe will be the stock price at the end of 3 years? (That is, what is ?) Round your answer to two decimal places. Do not round your intermediate calculations.

Reference no: EM131887057

Questions Cloud

Compute the effective annual interest rate of the loan : Compute the effective annual interest rate of the loan.
What is the best predicted iq of the twin born : What is the best predicted IQ of the twin born first twin born first?, given that the twin born second twin born second has an IQ of 106??
Calculating salvage value : Consider an asset that costs $404,800 and is depreciated straight-line to zero over its 10-year tax life.
What are the current controversies : Parkinson's disease is a progressive neurodegenerative disorder. Share your thoughts on the evolving therapies. What are the current controversies?
Market believe will be stock price at the end of three years : You are considering an investment in Justus Corporation's stock, what does the market believe will be the stock price at the end of 3 years?
Discuss the challenges that you might encounter : Discuss the challenges that you might encounter in using a mixed methods approach. Support your discussion using current mixed methods research articles.
Enough evidence to support the instructor claim : With a = 0.05, is there enough evidence to support the instructor's claim? Does your answer change if a = 0.01? Why or why not?
What is the project year three net cash flow : Summer Tyme, is considering new 3-year expansion project that requires initial fixed asset investment of $3.132 million.What is project's year 3 net cash flow?
Multiple regression and correlation analysis : What are the assumptions of multiple regression and correlation analysis?

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