I need answer of this question solution general accounting Extruded Elements had Net Income of $25,000,000 lastyear, and $26,250,000 this year (in line with its long-termearnings growth rate). There are 4,000,000 sharesoutstanding, and the firm follows a policy of paying 30%of its earnings out as dividends, the required rate ofreturn on extruded's shares is 13%.What is the share price today based on the Gordongrowth model?

Step 1:The formula to calculate the share price using the Gordon growth model is as follows: P = D1…

Answered: Extruded Elements had Net Income of…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter7: Common Stock: Characteristics, Valuation, And Issuance

Section: Chapter Questions

Problem 8P

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Please give me answer general accounting
Sultan Services has 1.4 million shares outstanding. It expects earnings at the end of the year of $5.20 million. Sultan pays out 60% of its earnings in total - 40% paid out as dividends and 20% used to repurchase shares. If Sultan's earnings are expected to grow by 5% per year, these payout rates do not change, and Sultan's equity cost of capital is 11%, what is Sultan's share price? OA. $14.86 OB. $22.28 OC. $37.14 O D. $7.43
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TNT Corporation's stock is currently selling at $36 per share. TNT reported total revenues of $5.26 billion over the past year, has a book value of equity of $2.9 billion, and has 296 million shares outstanding. Based on comparable firms, the appropriate P/S and P/B for TNT are 2.85 and 4.75, respectively. A. What is the stock's approximate intrinsic value based on the P/S multiplier? B. What is the stock's approximate intrinsic value based on the P/B multiplier?
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