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School
University of Nevada, Las Vegas *
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Course
301
Subject
Finance
Date
Nov 24, 2024
Type
PNG
Pages
1
Uploaded by Joannelulu
We
can
estimate
a
stock’s
value
by:
Multiple
Choice
using
the
book
value
of
the
total
stockholder
equity
section.
discounting
the
future
dividends
and
future
stock
price
appreciation.
O
O
@
O
using
the
book
value
of
the
total
assets
divided
by
the
number
of
shares
outstanding.
compounding
the
past
dividends
and
past
stock
price
appreciation.
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Related Questions
Which of the following is a method for valuing a stock using expected future dividends?A) Net Present Value (NPV)B) Dividend Discount Model (DDM)C) Price-to-Earnings (P/E) RatioD) Internal Rate of Return (IRR)
explain.
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Please make sure the answers are clear n easy to read.
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Which of the following is a method for valuing a stock using expected future dividends?A) Net Present Value (NPV)B) Dividend Discount Model (DDM)C) Price-to-Earnings (P/E) RatioD) Internal Rate of Return (IRR)
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The price of a stock is calculated by multiplying the benchmark P/E (price-earnings) ratio with the Blank______.
Multiple choice question.
benchmark price-sales ratio
earnings per share
capital yield ratio
dividend per share
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Identify the components of the total return of a stock. More than one answer may be correct.
Multiple select question.
Taxes
Capital gains yield
Dividend yield
Past prices
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The Expected Rate of Profit Formula looks at:
A.
Expected Profit & Money Invested
B.
Common Stock & Preferred Stock
C.
Expected Profit & Bonds
D.
All of the above
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Explain how to find the value of a stock given itslast dividend, its expected growth rate, and itsrequired rate of return.
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The dividend yield of a stock is determined by dividing the expected dividend (D1) by Blank______.
Multiple choice question.
the growth (g)
retained earnings
the discount rate (r)
the current stock price (P0)
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how do I compute or calculate valuation and relative value measure to assses stock correctly? calculation of stock price
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Stockholders' equity consists of which of the following?
Multiple Choice
Paid-in (or contributed) capital and retained earnings.
Retained earnings and cash.
Long-term assets.
Paid-in (or contributed) capital and par value.
Premiums and discounts.
k
arrow_forward
An informed and prudent investor uses a variety of measures such as financial ratios, book value, earnings per share, return on equity etc. to evaluate the worthiness and prospects of stocks he/she would invest in. It is important for you as an investor to understand how these values are calculated and what do they mean.
Use the following tables to assess the worthiness of Verticon stock as an investment.
Verticon Stock Data (Current and Historical)
2:12PM EDT Aug 16, 2011
Price
18.85 USD
Change
+0.64 (+3.51%)
Mkt cap
147.1B
Div/yield
0.20/4.24
Shares
8,012
Beta
0.70
Book/share
11.335
PE ratio
17
12/2010
12/2009
12/2008
(Millions of Dollars)
Total Assets
195,014
195,949
111,148
Total Liabilities
107,201
122,935
53,592
Preferred Shareholders’ Equity
52
61
73
Common Shareholders’ Equity
87,761
72,953
57,483
Shares Outstanding
8,012
8,070
6746
Book/Share
?
9.040
8.521
Q1 (Mar ’11)
2010
Net profit…
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Illustrate the impact of changes in the dividend, the growth rate, the expected return on the market, and the beta on the value of a stock.
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Stock and dividend returns can be shown in percentage, dollar, and per-share values.
True or False
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Define each of the following terms:a. Optimal distribution policyb. Dividend irrelevance theory; bird-in-the-hand theory; tax effect theoryc. Signaling hypothesis; clientele effectd. Residual distribution model; extra dividende. Declaration date; holder-of-record date; ex-dividend date; payment datef. Dividend reinvestment plan (DRIP)g. Stock split; stock dividend; stock repurchase
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Given the following information on five stocks, construct: a. A simple price-weighted average b. A value-weighted
average c. A geometric average d. What is the percentage increase in each average if the stock prices change to those in
Column I? e. What is the percentage increase in each average if the stock prices change from those in the Price column to
those in Column II? f. Why were the percentage changes different in parts (d) and (e)? g. If you were managing a fund and
wanted a source to compare your results to, which of the three averages would you prefer to use, and why?
Stock Price
# of Shares I
II
A
B
C
D
E
F
$12.00 150,000
$14.00
125,000
$11.00 200,000
$ 22.00 80,000
$8.00
30,000
$29.00 140,000
$12.00
$12.00
$14.00 $14.00
$20.00 $11.00
$ 22,00 $ 22.00
$8.00
$15.00
$29.00 $29.00
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Discuss how to determine the risk or beta of a stock, the required rate of return of a stock and the value of a stock. How do you determine if a stock has high or low or average risk when compared to the S&P 500? How do you determine if a stock is overpriced, underpriced or fairly priced? Explain and Discuss.
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Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
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