What is the current value of the stock

Assignment Help Finance Basics
Reference no: EM132398341

1. Zero growth: Nynet, Inc., paid a dividend of $4.18 last year. The company's management does not expect to increase its dividend in the foreseeable future. If the required rate of return is 18.5 percent, what is the current value of the stock?

2. Constant growth: Moriband Corp. paid a dividend of $2.15 yesterday. The company's dividend is expected to grow at a steady rate of 5 percent for the foreseeable future. If investors in stocks of companies like Moriband require a rate of return of 15 percent, what should be the market price of Moriband stock?

3. Preferred stock valuation: X-Centric Energy Company has issued perpetual preferred stock with a stated (par) value of $100 and a dividend of 4.5 percent. If the required rate of return is 8.25 percent, what is the stock's current market price?

Reference no: EM132398341

Questions Cloud

Calculate how many dollars the us firm would need : In making the choice as to where to hold the funds, are calculations necessary? Or do you know the result prior to doing any calculations? Explain.
Calculate the gain or loss of the trader : A trader sold $1 million worth of forward contracts on dollars at a forward rate of 0.78 pounds per dollar. The trader has a short position.
Professional development digital presentation : Describe what developmental milestones are and why they are important. Include examples of how these milestones may present differently for students without
Discuss whether it would be unethical to buy a stock : Discuss whether it would be unethical to buy a stock based on some information you found in the trash that had been thrown away by mistake.
What is the current value of the stock : The company's management does not expect to increase its dividend in the foreseeable future. If the required rate of return is 18.5 percent.
What is the market risk premium : If the risk-free rate is 6.00%, what is the market risk premium? For this problem. You need to explain the approach that you take to find the solution (4 lines)
Advantages of holding a corporation bonds : What are some of the advantages of holding a corporation's bonds? What are some disadvantages?
How do businesses obtain funds for long term financing : How do businesses obtain funds for long term financing? How do they go about selecting a method of financing?
Dual taxation or ease of ownership transfers : What is a characteristic that does not favor the corporate form of business over a sole proprietorship or partnership? Limited liability, Unlimited life

Reviews

Write a Review

Finance Basics Questions & Answers

  Describe what is meant by organization

Describe what is meant by organization. What are its characteristics and objectives? What factors must be addressed to ensure the successful accomplishment of its objectives?

  Determine the value of a share of dupont series

Determine the value of a share of dupont series a $4.50 cumulative preferred stock, no par, to an investor who requires a 9 percent rate of return on this security.

  What is the change in retained earning

If a corporation earns 270, 000 and the pay out ration (proportion distributed) is 30% what is the change in retained earning?

  What price motorcycle can raul afford

Raul Gutierrez would like to purchase a sport motorcycle, and can afford a monthly payment of up to $625. He qualifies for a 6 year loan, paid monthly.

  True or false question based on corporate tax

Cardinal, LLC incurred $20,000 of startup costs, $3,000 of organizational costs, and paid $10,000 in transfer taxes to change the title of a building contributed by one of LLC's members.

  What amount would your investment have been worth

The s&p tsx composite index delivered annual returns of 17.61% , -8.71% , 7.19% and 12.99% from 2010 to 2013. if you invested $10,000.

  Where marginal cost and marginal revenue are equal

If so, how can that be done? If the concept is applied, how confident should we be that the firm will achieve the point where marginal cost and marginal revenue are equal

  Show the effect of this open market operation using taccount

The Federal Reserve purchases $1,000,000 of foreign assets for $1,000,000. Show the effect of this open market operation using T-accounts.

  Supermarket customers load their carts with goods totaling

supermarket customers load their carts with goods totaling between 5 and 200 uniformly continuously distributed call

  What is WACC for ABC Corp

Assume the expected rate of return for debt is 6%. Also assume the preferred stock price = $25.6, and the preferred dividend = $1. What is WACC for ABC Corp.

  What are the five principle areas

OECD (Organisation for economic co-operation and development) principle of co-orporate governance offers a framework around which various issues

  Considered bad project management

If a project manager pads their schedule by adding extra days is that considered bad project management

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