What is the price per share of the company stock

Assignment Help Financial Management
Reference no: EM132029617

Ward Corp. is expected to have an EBIT of $2,200,000 next year. Depreciation, the increase in net working capital, and capital spending are expected to be $171,000, $97,000, and $121,000, respectively. All are expected to grow at 20 percent per year for four years. The company currently has $16,000,000 in debt and 810,000 shares outstanding. After Year 5, the adjusted cash flow from assets is expected to grow at 3.5 percent indefinitely. The company’s WACC is 8.6 percent and the tax rate is 40 percent. What is the price per share of the company's stock?

Reference no: EM132029617

Questions Cloud

You should pay for share of coyote stock : If you require a 12% rate of return on investments of this risk level, what is the most you should pay for a share of Coyote's stock ?
Face value zero-coupon bond : Zeta Corporation has issued a $1,000 face value zero-coupon bond. Which of the following values is closest to the correct price for the bond
Two bonds are expected to be similar in risk : If the two bonds are expected to be similar in risk, what price will a bond of McIntire Corp. sell for?
What would be the price per bond of the new bonds today : Five years ago Tosev Inc. issued 30-year, $1,000 par value, What would be the price per bond of the new bonds today?
What is the price per share of the company stock : The company’s WACC is 8.6 percent and the tax rate is 40 percent. What is the price per share of the company's stock?
What is the average return for stock : What is the average return for Stock A over this 5 year period?
Life insurance company has liability of series : Consider a life insurance company has a liability of a series of payments of 100,000 per annum in arrear for 20 years.
What is a noise trader and are noise traders good or bad : What is a noise trader and are noise traders good or bad for investors trying to beat the market?
What is the new price of the three-year bonds : What is the new price of the 3-year bonds? Which one of these bonds is more sensitive to a change in interest rates?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the required return of the portfolio

What is the beta of your portfolio? what is the required return of the portfolio?

  Analyzing possible acquisition of teller company

Penn Corp. is analyzing the possible acquisition of Teller Company.

  Uses straight line depreciation

GM2 uses straight line depreciation. It's tax rate rate is 40% paid quarterly and it's hurdle rate is 10%. Should it buy this new machine?

  What is the call premium of the bond

You own a bond with a coupon rate of 7.1 percent and a yield to call of 8 percent. what is the call premium of the bond?

  Expected to pay the dividends

South Side Corporation is expected to pay the following dividends over the next four years: $15, $11, $10, and $6.50. Afterward, the company pledges to maintain a constant 5 percent growth rate in dividends forever. If the required return on the stoc..

  Net present value is generally considered to be best method

Given that the net present value (NPV) is generally considered to be the best method of analysis, why could you still use the other methods? You need to use other methods because the net present value method is unreliable when a project has unconvent..

  Determine what is the yield on 3-year t-bond today

Suppose 1-year Treasury bonds yield 1 year from now is 4.00%, 1-year T-bond yield 2 years from now is 5%, and 1-year T-bond 3-year from now is 6%.

  Define the components of the camels criteria

What is the difference between a bank that is insolvent and one that is illiquid?Define the components of the CAMELS criteria.

  Proposed project requires an initial cash outlay

A proposed project requires an initial cash outlay of $49,000 for equipment and an additional cash outlay of $18,700 in Year 1 to cover operating costs. During Years 2 through 4, the project will generate cash inflows of $42,500 a year. What is the n..

  Corporate bond-which of the best describes this bond

A corporate bond makes payments of $9.67 every month for ten years with a final payment of $2009.67. Which of the following best describes this bond?

  The goal of short-term cash flows management

The goal of short-term cash flows management is

  Bond currently sells at yield to maturity

A 25-year maturity, 8.7% coupon bond paying coupons semiannually is callable in six years at a call price of $1,135. The bond currently sells at a yield to maturity of 7.7% (3.85% per half-year). What is the yield to call? What is the yield to call i..

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