4. Toyota Motor Corp's stock price is about $157. Consensus analysts' forecasts about Toyota'searnings in 2022 and 2023 are $16.21 and $17.95, respectively. The book value per share is $160.6.The company has a payout ratio about 25%. The risk free rate for Japan capital market is 0.24% andthe market risk premium is about 7.75%. Firm Beta is estimated to be about 0.64. <a. Forecast book value, return on common equity, and residual earnings for 2022 and 2023.<b. Provide a building block analysis about each company's stock price.<C. What are the implied market's expectation about growth rates of Toyota's long-term residualincome after 2024?<d. If you are a value investor, how would you evaluate Toyota price and make investment decisions?Also what additional factors you may need to find out more information about in making your finaldecision?<

The objective of the question is to analyze the financial performance of Toyota Motor Corp using…

Answered: 4. Toyota Motor Corp's stock price is…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter12: The Cost Of Capital

Section: Chapter Questions

Problem 22P

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