What is the value of a share of sinclair pharmaceuticals

Assignment Help Finance Basics

Reference no: EM13551503

Sinclair Pharmaceuticals, a small drug company, develops a vaccine that will cure the common cold. It is expected that Sinclair Pharmaceuticals will experience extremely high growth over the next three years and will reinvest all of its earnings in expanding the company over this time. Earnings were $1.20 per share before the development of the vaccine and are expected to grow by 40% per year for the next three years. After this time, it is expected growth will drop to 5% and stay there for the expected future. Four years from now Sinclair will pay dividends that are 75% of its earnings. If its equity cost of capital is 10%, what is the value of a share of Sinclair Pharmaceuticals today?

Reference no: EM13551503

Questions Cloud

Competitive advantage of the company : HR activities - explain how each one contributes in achieving the competitive advantage of the company.

What is the work done by the surroundings on the gas : A gas expands, changing its volume by +4.24×10-4 m3 while at a constant pressure of 6.44×105 Pa. What is the work done by the surroundings on the gas

Capital structure weights on a book value basis : What are the company's capital structure weights on a book value basis?

Who is the intended audience eg researchers or practitioners : Who is the intended audience eg researchers or practitioners-Is the writing style appropriate for this audience - Analyze the various parts of each article thoughtfully and carefully so that you can establish its strengths and weaknesses.

What is the value of a share of sinclair pharmaceuticals : What is the value of a share of Sinclair Pharmaceuticals today?

Determine how far down does the web extend : Spider silk has a Young's modulus of 4.0x10^9 N/m^2 and can withstand stresses up to 1.4x10^9 N/m^2. If the web is 0.10 m in radius, how far down does the web extend

What is the difference in the way managers will behave : What is the difference in the way managers will behave regarding their capital structure decisions in each of these theories. Explain fully.

How many moles of helium are in the balloon : A spherical balloon of volume 4.08 103 cm3 contains helium at a pressure of 1.21 105 Pa. How many moles of helium are in the balloon

Calculate the final kinetic energy of the electrons : Electrons are accelerated through a voltage difference of 300 kV inside a high voltage accelerator tube. What is the final kinetic energy of the electrons

User Account

All Pages