What is market capitalization of haytech

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Reference no: EM131950073

The company Haytech, Inc. is a 100% equity financed firm. The stock is currently valued at $25 per share, with analysts expecting earnings of $2.25 per share for the next year. Assume that: (a) the required rate of return on equity (discount rate) for Haytech is 13.50%, (b) the company has 150 million shares outstanding, and (c) the company’s payout ratio will remain constant at 50%.

a. What is the market capitalization of Haytech, Inc's equity today?

b. What dividend per share do investors expect next year?

Reference no: EM131950073

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