Given the information below for Sugar Rush, compute the expected share price bythe end of 2023 using price P/E. Assume that the historical arithmetic averagegrowth rates will remain the same. For 2018, the EPS was $4.50. Hint: calculate theaverage EPS growth rate and the average P/E.YearPriceEPS$96.50.$74.25.$98.00.$80.85.$100.00.$106.70.2019$65$4.502020$58$4.002021$76$5.502022$98$6.00

The price per share can be found by using the P/E ratio and the EPS value as it depicts the…

Answered: Given the information below for Sugar…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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2.SAM Corporation expects the following dividend pattern over the next seven years: 2015 2016 2017 2018 2019 2020 2021 $1.00 $1.10 $1.21 $1.33 $1.46 What is the price of this stock today if an investor wants to earn a. 15%? b. 12%? $1.61 $1.80 0
Suppose in 2023 the expected dividends of Fordson, Inc. stock will equal $260M with a discount rate of 8% and an expected growth rate for the dividends of 6%. Assuming constant growth rate, if interest increases to 9%, will the val of the company increase or decrease and by how much?
Suppose in 2023 the expected dividends of Fordson, Inc. stock will equal $260M with a discount rate of 8% and an expected growth rate for the dividends of 6%. Assuming constant growth rate, if interest increases to 9%, will the val of the company increase or decrease and by how much?
Stock valuation
Term Horizon value Current intrinsic value Value If investors expect a total return of 12.60%, what will be Goodwin's expected dividend and capital gains yield in two years-that is, the year before the firm begins paying dividends? Again, remember to carry out the dividend values to four decimal places. (Hint: You are at year 2, and the first dividend is expected to be paid at the end of the year. Find DY, and CGY,.) $26.55 $19.03 Expected dividend yield (DY) Expected capital gains yield (CGY,) Goodwin has been very successful, but it hasn't paid a dividend yet. It circulates a report to its key investors containing the following statement: No Goodwin's investment opportunities are poor. Yes 9.20% 4.29% Is this statement a possible explanation for why the firm hasn't paid a dividend yet?
Consider company ABC. Today it is the 1st of January 2022. The expected earnings of ABC (in million £) for the next few years (as per the 1st of January) are forecast to be: Year 2023 2024 2025 2026 2027 Expected Earnings 1 1.5 0.9 1.2 1.3 From year 2027 and onwards the earnings of ABC are expected to grow with a growth rate of 5%. The required rate of return of ABC is 12%. The dividend policy of ABC is currently such that they pay out 80% of their earnings as dividends, i.e. their earnings retention ratio b is constant and equals 0.2. The forecast of the growth rate is based on an earnings retention ratio of 0.2. Suppose that you forecast Return on new Investment (RI) to be 10%. What is the optimal dividend policy? Explain.
Company XYZ is investors expect earnings and dividends to grow at a constant rate of 8% in the future dividend is expected to be paid at the rate of $3.40 per share next year, and its stock currently sells at a price of $60 per share. Calculate the cost of Common equity?
2. Google will pay its dividends of $5 in 2020 and $6 in 2021. It plans to pay a constant dividend of S7 from 2022 permanently. D Given the required return ofr 20 percent, what is the stock price of Year 2021? (You don't have to calculate the dividend growth rate. Please use the current dividend information) 2) Given the required return of 20 percent, figure out the stock price of Year 2020, based on both the stock price and dividend of Year 2021. (If you cannot figure out the stock price of Year 2021, please use $30.) ( 3) Given the required return of 20 percent, what is the current stock price in 2019 (SPo) based on both the stock price of Year 2021 and dividends of Year 2020 and 2021?
pm.8
Bhupatbhai
2. Calculate the value of a stock with an expected annual dividend of $2.00 next year and an estimated annual dividend growth of 2% per year indefinitely. Assume a discount rate of 8%. Solve the problem two different ways: first by using the algebraic formula for the Gordon Growth Model, then by using Excel to calculate and sum the dividends and their respective present values for the next 150 years. hint: Use the PV ConstGrowth Dividend example in the posted DDM Excel Examples file as a guide. Feel free to copy the worksheet and make the minor necessary changes to answer this question.
Given the information below for HooYah! Corporation, compute the expected share price at the end of 2022 using price ratio analysis. Assume that the historical (arithmetic) average growth rates will remain the same for 2022. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Exclude negative annual P/E and P/CFPS ratios from the average PE and average P/CFPS ratio calculations. When computing annual growth rates, use a positive sign on the annual rate of change if the per share value increased in value and use a negative sign on the annual rate of change if the per share value deceased in value. Year Price EPS CFPS SPS 2016 $27.00 -7.00 -18.00 24.00 Using PE ratio Using P/CF ratio Using P/S ratio 2017 $63.50 -6.29 -15.50 32.50 $ Answer is complete but not entirely correct. Share Price $ $ 2018 $ 135.00 -2.30 -3.30 27.60 11.22 X 112.88 142 30 2019 $ 212.00 -0.57 -0.05 31.10 2020 $ 102.00 0.05 0.63 34.60 2021 $32.50 0.06 0.08 40.95

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