Share price using the constant growth model

Assignment Help Financial Management

Reference no: EM131300291

Over the past 16 years, Walmart's dividends have grown from $0.27/yr to $1.99/yr. Assuming the same growth rate and a market discount rate of 16%, compute the present value of Walmart's share price using the constant growth model.

Reference no: EM131300291

Questions Cloud

What is expected capital gains yield-dividend yield : The next dividend payment by Halestorm, Inc., will be $2.00 per share. The dividends are anticipated to maintain a growth rate of 6 percent forever. The stock currently sells for $40 per share. What is the dividend yield? What is the expected capital..

Maintenance to minimize the overall equivalent annual cost : The initial cost of a bridge that is expected to be in place forever is $7O llion. Maintenance can be done at 1-, 2-, 3-, or 4-year intervals, but the longer the interval between servicing, the higher the cost. What interval should be scheduled for m..

Relative to the other cash management models : Which of the following motives for holding cash concerns managers’ ability to meet financial obligations when due? Relative to the other cash management models (i.e. Baumol Model and Miller-Orr Model), the Stone model is _______________practical.

Pay over the life of the loan from the higher interest rate : Recently, Wells Fargo CEO John Stumpf testified before the Senate Finance Committee regarding the opening of over 2 million accounts without client consent. In some cases, people were charged fees, late fees, and collection fees on accounts they had ..

Share price using the constant growth model : Over the past 16 years, Walmart's dividends have grown from $0.27/yr to $1.99/yr. Assuming the same growth rate and a market discount rate of 16%, compute the present value of Walmart's share price using the constant growth model.

What is the principle remaining on the loan : Suppose you take out a loan for $24,475 to purchase a 2016 Nissan Altima. Nissan offers $500 cash back (which you use as part of the down payment), and you also put $2,299 of your own money down (so a total down payment of $2,799). After three years..

Information technology in health care and public health : Why has implementation of information technology in health care and public health been so slow in comparison to other industries? Discuss the relative importance of factors such as ?nancial incentives or disincentives, organizational culture, complex..

What is the cost of debt-beforetax : Suppose McDonald’s has a bond issue outstanding that matures in 25 years. The bond pays interest semi-annually. The bond is currently selling for $908.72 per $1000 bond. McDonald’s average tax rate is 30% and marginal tax rate is 36%. (use annual com..

Firms recent earnings per share and dividend per share : Suppose that a firm’s recent earnings per share and dividend per share are $2.65 and $1.60, 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 t..

User Account

All Pages