Reference no: EM131826540
The Board of Directors of Whazzup, Inc. is planning the company's initial public offering (IPO) of common stock. Whazzup's chief financial officer (CFO), Chiquita Banana, is conducting an analysis to estimate the price at which the stock will trade. It is now Januaary 1, 2002. The company has never paid a dividend, but expectes to pay a dividend of $0.75 per share on December 31, 2005 and on December 31, 2006. Ms. Banana expects the dividend to grow by 7% from 2006 to December 31, 2007, and by 5% the following year. Thereafter, (i.e., from 2009 onward) the dividend is expected to grow by 3% per year forever.
Investors requrie a return of 12% per year on stocks like Whazzup. Management expects to issue 5,000,000 shares.
a. What is the likely initial price for Whazzup's stock as of January 1, 2002?
b. What will be the total market value of Whazzup's common stock as of January 1, 2002?
c. What will the price of the stock be on January 1, 2006, just after the dividend is paid?
|
Find the? car speed for each part of the trip
: If he drove for 9 ?hours, find the? car's speed for each part of the trip.
|
|
Determining the resource allocation
: A coffee manufacturer uses Colombian and Brazilian coffee beans to produce two? blends, robust and mild. A pound of the robust blend requires 1212
|
|
Write a java program that accepts a number of minutes
: Write a Java program that accepts a number of minutes and converts it both to hours and days. For example, 6000 minutes equals 100 hours and equals 4.167 days.
|
|
Find the dimensions of the hall
: The area of a hall is 806 sq. ft. Its length is 5 ft greater than its width.
|
|
What will be total market value of whazzup common stock
: What is the likely initial price for Whazzup's stock as of January 1, 2002? What will be the total market value of Whazzup's common stock as of January 1, 2002?
|
|
Describe the use of the design elements shape
: Explain how the primary principles of unity, variety, hierarchy, dominance, proportion, and balance affect the design composition as a whole.
|
|
Find the? car speed for each part of the trip
: He then drove 230 miles at a speed that was 7 miles per hour faster than his previous speed. If he drove for 12 ?hours, find the? car's speed for each part
|
|
Characteristic of common stock ownership
: Which of the following is not a characteristic of common stock ownership? Residual claimant Unlimited liability Voting rights Limited life of the security.
|
|
Define type of connectivity to enterprise systems
: With the proliferation of smart phones and intelligent computing tablets such as the iPad, enterprises are increasingly faced with employees who want to bring t
|