What is the price of a share of the stock today

Assignment Help Financial Management

Reference no: EM131356162

LE Inc. is experiencing a period of rapid growth. Earnings per share is expected to grow at a rate of 12 percent during the next three years, 10 percent in the fourth year, 7 percent in the fifth year, and at a constant rate of 3 percent thereafter. The firm just provided $2.50 dividend last week. If the required rate of return on the stock is 12 percent, what is the price of a share of the stock today?

Reference no: EM131356162

Questions Cloud

What do you already know about this topic : MKT 646 :For what company and product and/or service will you present a marketing plan? What are the reasons for this selection? What are your marketing objectives?What do you already know about this topic, and what areas will require research?

What is depreciation expense-operating cash flow in year one : A company wants to update their assets by buying some new machinery and selling some old equipment. The new machinery will cost $100,000 and will be depreciated using 3-year MACRS (33%, 45%, 15%, 7%). At the end of the third year, the machinery is ex..

Explain companys resources capability and core competencies : Determine the company's resources, capabilities, and core competencies. With the same two forces in mind, predict what the company might do to improve its ability to address these forces in the near future.

Calculate total fees for return : A hedge fund with $1B of assets charges a mgt fee of 2% and an incentive fee of 20% of returns over the money-market rate (which is currently 5%). Calculate total fees (in dollars and percent) for a return of 10%?

What is the price of a share of the stock today : LE Inc. is experiencing a period of rapid growth. Earnings per share is expected to grow at a rate of 12 percent during the next three years, 10 percent in the fourth year, 7 percent in the fifth year, and at a constant rate of 3 percent thereafter. ..

Describe the advantages and disadvantages of free trade : B6512.21- Describe the advantages and disadvantages of free trade. Explain if free trade can ever be fair. Justify your response. Explain measures that a country can take to protect itself from the negative aspects of free trade.

Bondholders can convert their bond into firm common stocks : Firm A just issued a convertible bond which bondholders can convert their bond into firm’s common stocks right after the second year. This bond is 10-year, 6 percent coupon bond with $1,000 face value. What would be the price of this convertible bond..

Advise linyu of her rights under the australian consumer law : Linyu wants to buy a car. She inspects several different vehicles advertised as brand new at a car dealership owned by Yuan. Advise Linyu of her rights under the Australian Consumer Law

Compare and contrast all factors in your essay : B6512.22- Present these data in one table. Compare and contrast all factors in your essay. Write a critical analysis of macroeconomic status, reasons and consequences of selected countries.

User Account

All Pages