What is pancakes intrinsic value

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The Pancake Corporation recently paid a $3.00 dividend and is expected to grow at 4.5% forever. Investors generally require an expected return of at least 8% before they'll buy stocks similar to those of Pancake.

a. What is Pancake's intrinsic value? Round the answer to two decimal places.

b. Is it a baraain if it's selling at $71 a share? (Assume that a share is worth buying when its estimated value is greater or equal to 120% of the market price.)

Reference no: EM131079472

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