FIN_3000 Problem 2

Q1. (a) You are a stock analyst in charge of valuing high-technology firms, and you are expected to come out with buy-sell recommendations for your clients. You are currently analyzing a firm called etalk.com that specializes in internet-based communication. You are expecting explosive growth in this area. However, the company is not currently profitable even though you believe it will be in the future. Your projections are that the firm will pay no dividends for the next 2 years. Three years from now, you expect the stock to pay its first dividend of $1.50 per share. You expect dividends to increase at a rate of 10 percent per year for two years after that. At that point, the industry will start to mature and growth will slow down; dividends will continue to grow at a rate of 5 percent per year for the foreseeable future.The stock is trading on the Sauder Stock Exchange for $15 per share. If you believe that the required rate of return is 12 percent, what is your estimate of the value…

Using the free cash flow valuation model to price an IPO Personal Finance Problem Assume that you have an opportunity to buy the stock of CoolTech, Inc., an IPO being offered for $22.92 per share. Although you are very much interested in owning the company, you are concerned about whether it is fairly priced. To determine the value of the shares, you have decided to apply the free cash flow valuation model to the firm's financial data that you've accumulated from a variety of data sources. The key values you have compiled are summarized in the following table, E a. Use the free cash flow valuation model to estimate CoolTech's common stock value per share. b. Judging by your finding in part a and the stock's offering price, should you buy the stock? c. On further analysis, you find that the growth rate in FCF beyond 2023 will be 7% rather than 6%. What effect would this finding have on your responses in parts a and b? a. The value of CoolTech's entire company is $| (Round to the nearest…

Using the free cash flow valuation model to price an IPO Personal Finance Problem Assume that you have an opportunity to buy the stock of CoolTech, Inc., an IPO being offered for $4.61 per share. Although you are very much interested in owning the company, you are concerned about whether it is fairly priced. To determine the value of the shares, you have decided to apply the free cash flow valuation model to the firm's financial data that you've accumulated from a variety of data sources. The key values you have compiled are summarized in the following table, a. Use the free cash flow valuation model to estimate CoolTech's common stock value per share. b. Judging by your finding in part a and the stock's offering price, should you buy the stock? c. On further analysis, you find that the growth rate in FCF beyond year 4 will be 3% rather than 2%. What effect would this finding have on your responses in parts a and b? a. The value of CoolTech's entire company is $ Data table (Click on…

Using the free cash flow valuation model to price an IPO Personal Finance Problem Assume that you have an opportunity to buy the stock of CoolTech, Inc., an IPO being offered for $7.41 per share. Although you are very much interested in owning the company, you are concerned about whether it is fairly priced. To determine the value of the shares, you have decided to apply the free cash flow valuation model to the firm's financial data that you've accumulated from a variety of data sources. The key values you have compiled are summarized in the following table, E a. Use the free cash flow valuation model to estimate CoolTech's common stock value per share. b. Judging by your finding in part a and the stock's offering price, should you buy the stock? c. On further analysis, you find that the growth rate in FCF beyond year 4 will be 4% rather than 3%. What effect would this finding have on your responses in parts a and b? a. The value of CoolTech's entire company is $. (Round to the…

Suppose you own stock in a company. The current price per share is P25.00. Another company has just announced that it wants to buy your company and will pay P35.00 per share to acquire all the outstanding stock. Your company’s management immediately begins fighting off this hostile bid. Is management acting in the shareholders’ best interests? Why or why not?

Please provide correct solution these general accounting question

Your broker Luke works for a major bank that is working on the merger between ABC Inc. and XYZ Corp. The news is going to be released to the public next week. If you decide to buy some stocks now and split the profits with Luke, your actions should be categorized as ______.   Question 27 options:   A)    It is not possible to tell from the information given B)    ethical but illegal C)    unethical but legal D)    unethical and illegal E)    ethical and legal

What's the equation in excel?

Suppose you own 100 shares of IBM stock which you intend to sell today. Since you will sell it in the secondary market, IBM will receive no direct cash flows as a consequence of your sale. Why, then, should IBM’s management care about the price you get for your shares?

There is a new IPO of firm whose value might be 50 or 100 with equal probability. A lot of investors know the value of the firm because they had access to the accounts but you do not. What would be your maximum bid in an auction IPO? a. 75 b. 0 c. 50 d. 100

In a few sentences, answer the following question as completely as you can. Imagine you are the treasurer of a small manufacturing firm. Your firm is planning to go public (i.e., sell stock to investors for the first time). One unresolved question concerns the market’s required return on the stock. Given what you have learned, how do you think the required return will affect the market value of your firm’s stock? How would you go about estimating this rate?

Solve and show solution. Do not use excel cell in the solution

please answer the 3rd question

Question  Full explain this  question very fast and text typing work only.

Solve the problem

A friend of yours owns a company that is about to get a large government contract.  He tells you this inside information about the contract and also mentions that it should make the company's stock price increase dramatically.  If you invest based on this inside information, then you are implicitly saying that stock markets are inefficient in which context?   Question 5 options:   weak form efficient market theory   semi-strong form efficient market theory   strong form efficient market theory

What's the equation in excel and answer?

M4

am. 128.

Question content area top What are the formulas to figure out these problems?  I have the answer but I want to be able to figure out how to get the answer. Part 1 ​(Common stock​ valuation)  Dubai​ Metro's stock price was at ​$100 per share when it announced that it will cut its dividend for next year from ​$10 per share to ​$6 per​ share, with additional funds used for expansion. Prior to the dividend​ cut, Dubai Metro expected its dividends to grow at a 4 percent​ rate, but with the​ expansion, dividends are now expected to grow at 7 percent. How do you think the announcement will affect Dubai​ Metro's stock​ price?       Question content area bottom Part 1 a.  What is the​ investor's required rate of return for Dubai​ Metro's stock?   14.0014.00​% ​(Round to two decimal​ places.) Part 2 b.  What would be the price of Dubai​ Metro's stock if they cut the dividend to ​$6​?   ​$85.7185.71   ​(Round to the nearest​ cent.) Part 3 c.  How do you think Dubai​ Metro's stock price…

finance Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Do not provide Excel Screet shot rather use tool table Answer completely.