What should be the pv of the stock

Assignment Help Finance Basics
Reference no: EM132481170

XYZ stock will pay its first yearly dividend of $2.00, three years from today. The dividends will grow at a rate of 5% per annum until the 7th year. After that the dividends will grow at a rate of 3% until the end of the 15th year. After that the dividends will grow at a rate of 2% forever. If the return of XYZ stock is 10% per annual what should be the PV of the stock?

Reference no: EM132481170

Questions Cloud

What causes the change in optimal strategy : What causes the change in optimal strategy when taxes are added back to the m&m theorem?
What is the value of the bond : The par value is $1000 and the bond has 3 years to maturity. The yield to maturity is 7%. What is the value of the bond? Choose the closest number.
Calculate principal balance at the end of second term : Calculate the principal balance at the end of the second term, assuming they reduce the amortization period to 20 years on renewal after the first five year
Higher percent of millennials hold debt : A higher percent of Millennials hold debt than any other group except Gen X, yet the average Millennial debt is lower than every group except
What should be the pv of the stock : After that the dividends will grow at a rate of 2% forever. If the return of XYZ stock is 10% per annual what should be the PV of the stock?
What is the current price of the stock : The relevant discount rate given ABC's risk is 15% per year. What is the current price of the stock?
Impact on investors preferences for dividends : The "baby boomer" generation is getting close to retirement. Will this have any impact on investors' preferences for dividends?
How many payments are required to repay the? debt : A loan of ?7,000 is repaid by payments of ?$382 7% compounded semi dash annually.
BU5556 Real Options and Decision Making Assignment : BU5556 Real Options and Decision Making Assignment help and solution, University of Aberdeen - assessment writing service - Explain how to estimate the market

Reviews

Write a Review

Finance Basics Questions & Answers

  Decision making question based on finance

My company is located in MO and I am planning opening a branch office in Ohio. Under normal economic conditions, which have a 45 percent chance of occurring,

  Adjusting the exchange rate to compensate for inflation

From the base price level of 100 in 1981, Saudi Arabian and U.S. price levels in 2010 stood at 200 and 412, respectively. If the 1981 $/riyal exchange rate.

  Depreciation accounting ethical-legitimate depreciation

Are your changes in depreciation accounting ethical or legitimate depreciation assumptions? What will be the effects on the Balance Sheet, Income Statement, and profit margins of your actions?

  What shape would the probability distribution have

The probability distribution of a less risky expected return is more peaked than that of a riskier return. What shape would the probability distribution have for (a) completely certain returns and (b) completely uncertain returns?

  Determine the required sales volume

Senbet Ventures is planniing starting a new company to produce stereos. The sales price would be set at 1.5 times the variable cost for each unit; the VC/unit is estimated to be 2.50;

  What problems could they run into by using the same system

MNEs often transfer their domestic performance evaluation systems into the international environment. Why is that the case? What problems could they run into by using the same system?

  Equity cost of capital

Using the information, assume you are holding a market portfolio and have invested $12,000 in Stock C.

  Coupon rate should the company set

The company currently has 6% coupons bonds on the market that sell for $1,337, make semiannual payments, and mature in 15 yrs. What coupon rate should the company set on its new bonds if it wants them to sell at par? The bond has a face value of ..

  What is the expected return on the resulting portfolio

Suppose you invest equal amounts in a portfolio with an expected return of 12 percent and a standard deviation of returns of 16 percent and a risk-free asset

  Find the earnings per share

Find the earnings per share. Find the dividends per share. Find the book value per share. Find the market to book ratio. Find the price-earnings ratio.

  What is the fair price for paddy

The appropriate discount rate for Paddy is 10%. Based on your forecasts, what is the "fair" price for Paddy?

  Equal employment opportunity commission web site

Visit the Equal Employment Opportunity Commission Web site. Pay particular attention to the "Statistics" tab on the "About EEOC" menu.

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