Sustainable growth rate-shield corp

Assignment Help Finance Basics
Reference no: EM132657624

-A firm is expected to have earnings next year of $5.44 per share and the firm is expected to pay a dividend of $3.42. Investors' required rate of return is 12%. If the sustainable growth rate is 3.5%, what must be the rate of return earned by the firm on its new investments? Enter your answer as a percentage. Enter your response below rounded to 2 DECIMAL PLACES.

-Strawberry Co. has a stock that has a current price of $38.72. A year from now, the stock is expected to pay a dividend of $3.15 and the price will be $36.81. What is the expected rate of return for this stock? Enter your answer as a percentage. Do not include the percentage sign in your answer. Enter your response below rounded to 2 DECIMAL PLACES.

-Consider a stock that will have dividends in the next three periods of $1.75, $1.89, and $1.96, respectively. The interest rate is 9%. What is the growth rate of the dividend in period 3? Enter your answer as a percentage. Enter your response below rounded to 2 DECIMAL PLACES.

-Shield Corp. expects an earnings per share of $2.35 and reinvests 25% of its earnings. Management projects a rate of return of 2% on new projects and investors expect a 10% rate of return on the stock. What is the sustainable growth rate? Enter your answer as a percentage. Enter your response below rounded to 2 DECIMAL PLACES.

Reference no: EM132657624

Questions Cloud

What amount would beta division operating income increase : The two divisions and 70,000 units of materials are transferred to Alpha Division, by what amount would Beta Division's operating income increase?
Describe an advantage to the lender for the same situation : Describe an advantage to the borrower that stems from a sequence of receiving a 180-day loans as opposed to having a short term loan instead.
Compute which perspective of the balanced scorecard : Company growth rates (compared to industry growth rates) may be an example of measuring which perspective of the balanced scorecard?
Define and discuss the consensus view : In 2-3 paragraphs, using critical thinking and your own thoughts, define and discuss the consensus view. Do you agree with this view? The response must be.
Sustainable growth rate-shield corp : -A firm is expected to have earnings next year of $5.44 per share and the firm is expected to pay a dividend of $3.42. Investors' required rate of return is 12%
How does the auto company mercedes-benz apply : Determine the profitability of their product and how it's used to make the operations more profitable when it come to the high-end luxury auto production?
Calculate the taxable income of the business entity : The business entity is equally owned by four owners. Calculate the taxable income of the business entity if the entity is a partnership, a C corporation
Find the rate of change for rent in columbus : The fair market Rental rate for Columbus was $630 in 2013 and $551 in 2003. Find the rate of change for rent in Columbus during this period.
Record the elimination of the intercompany holdings of posey : Record the elimination of the intercompany holdings of Posey's bonds. Record the entry to eliminate the intercompany interest receivables/payables.

Reviews

Write a Review

Finance Basics Questions & Answers

  Calculate the call option value at the end of one period

calculate the call option value at the end of one period for a european call option with the following terms the

  What is the specific form of the actual demand function

A monopoly sells 30 units of output when price is £12 and 40 units when price is £10. If its demand schedule is linear, what is the specific form of the actual.

  Calculate current stock price

Sarah wishes to buy XYZ stock today. She estimates that it will be worth $490 per share in exactly 2-years from now, and she has a minimum return requirement of 15 percent.

  Percentage of total assets

Whitewater Co. has a total liabilities-to-total equity ratio of 0.75. What are total liabilities as a percentage of total assets?

  Problem on peter corporation balance sheet

The stockholders' equity section of Peter Corporation's balance sheet at December 31, 2014, follows.

  Best decision using the maximax criterion

(a) What is the best decision using the maximax criterion? What is the payoff for it? (b) What is the best decision using the maximin criterion? What is the payoff for it? (c) What is the best decision using the minimax regret criterion? What is the ..

  What was the most significant item in the cash flows

Company Subject is: Nike. What was the most significant item in the cash flows used for investing activities section

  Define insurance and an insurance policy

Describe how insurance policies can be used to protect the business from risks caused by certain events and from risks to their employees' personal security

  If the appropriate market rate for investments similar to

laserclok corporation paid a dividend for 50 years until it experienced financial difficulty three years ago at which

  Another tool used to evaluate projects is called the

another tool used to evaluate projects is called the profitability index pi or benefitcost ratio. this index is

  Computation of npv of the project at various interest rates

Computation of NPV of the project at various interest rates and what is the NPV of this project if the five-year interest rate is

  Acceptance of an offer under contract law

Explain the Uniform Commercial Codes' position on acceptance of an offer under Contract Law.

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