What is this stock worth today at nine percent discount rate

Assignment Help Financial Management
Reference no: EM131525438

Marshall Arts Studios just paid an annual dividend of $1.45 a share. The firm plans to pay annual dividends of $1.50, $1.65, and $1.88 over the next 3 years, respectively. After that time, the dividends will be held constant at $1.70 per share. What is this stock worth today at a 9 percent discount rate? $14.08 $14.30 $16.67 $18.80 $18.99.

Reference no: EM131525438

Questions Cloud

Explain the objectives of training and development schemes : Explain the objectives of training and development schemes to create excellent customer service, including the methods that would best establish these
What does modern portfolio theory show : What does modern portfolio theory show and what does it describe to achieve? What's the name of the portfolio used to achieve this goal?
What is implied value of the warrants attached to each bond : Gregg Company recently issued two types of bonds. The first issue consisted of 20-year straight debt with an 8 percent annual coupon.
What time value is implied in your price : Maese Industries Inc. has warrants outstanding that permit the holders to purchase 1 share of stock per warrant at a price of $25.
What is this stock worth today at nine percent discount rate : What is this stock worth today at a 9 percent discount rate?
Define human resource management : Define human resource management and discuss the role of human resource manager. Write an essay about it.
Find the current exchange rates online : Find the current exchange rates online and post the current exchange between the U.S. dollar and any other currency.
Behavior concepts to a workplace situation : Consider the eight steps to inclusion highlighted in this week's readings and videos.
Own this property in order to generate positive irr : How many years would you need to own this property in order to generate a positive IRR?

Reviews

Write a Review

Financial Management Questions & Answers

  Bankruptcy costs born by bond holders in case of bankruptcy

A company has a zero-coupon bond outstanding, with face value 1,000 and a 3 year maturity. The bond is risky with a beta of 0.7. The risk free rate is 2% and the market risk premium is 6%. There are two equally likely scenarios at maturity:

  Determine the present value of the stream

An owner can lease her building for $120,000 per year for three years. The explicit cost of maintaining the building is $40,000, and the implicit cost is $55,000. All revenues are received, and costs borne, at the end of each year. If the interest ra..

  What is the current value of this bond

Due to a number of lawsuits related to toxic wastes, a major chemical manufacturer has recently experienced a market reevaluation. The firm has a bond issue outstanding with 15 years to maturity and a coupon rate of 8 percent, with interest being pai..

  Percentage from your payments goes to is principle payment

Suppose you borrowed $12,000 at a rate of 9.0% and must repay it in 4 equal installments at the end of each of the next 4 years. How large would your payments be? For year 3, what percentage from your payments goes to is the principle payment?

  What portfolio of these two stocks has zero?risk

What portfolio of these two stocks has zero?risk?

  Individual or component costs of capital

(Individual or component costs of capital) Your firm is considering a new investment proposal and would like to calculate its weighted average cost of capital. A new common stock issue that paid a $1.74 dividend last year. The par value of the stock ..

  The price-weighted index

Able, Baker, and Charlie are the only three stocks in an index. The stocks sell for $36, $312, and $82, respectively. If Baker undergoes a 3-for-2 stock split, what is the new divisor for the price-weighted index?

  Expressed as annual rate with semi-annual compounding

what is the 6 month forward rate, beginning in 6 months, expressed as an annual rate with semi-annual compounding?

  Appropriate discount rate for the project

Lakonishok Equipment has an investment opportunity in Europe. The project costs €12 million and is expected to produce cash flows of €1.8 million in Year 1, €2.6 million in Year 2, and €3.5 million in Year 3.

  When creating bond investment strategy

When creating a bond investment strategy, one should consider his: investment goal; investment horizon; risk tolerance; tax status; all of the above

  Calculate the return on invested capital for each firm

Firms HL and LL are identical except for their leverage ratios and the interest rates they pay on debt. Each has $18 million in invested capital, has $5.4 million of EBIT, and is in the 40% federal-plus-state tax bracket. Calculate the return on inve..

  Since investing in stocks and bonds is also saving money

Since investing in stocks and bonds is also saving money, it's obvious that savings equals investment!

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