Henderson Freight Corp. is expected to have earnings per share (EPS) of $4.50 next year. If the average industry P/E ratio is 20, what is the estimated current price of Henderson Freight Corp.'s stock?
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- Best Corporation is expected to pay $.60 next year and $1.10 the following year and $1.25 each year thereafter. If the required return is .14, what is the priice of the stock? $7.40 $2.95 $8.24 $2.22Boehm Incorporated is expected to pay a $2.20 per share dividend at the end of this year (i.e., D1 = $2.20). The dividend is expected to grow at a constant rate of 7% a year. The required rate of return on the stock, rs, is 17%. What is the estimated value per share of Boehm's stock? Do not round intermediate calculations. Round your answer to the nearest cent.Boehm Incorporated is expected to pay a $1.40 per share dividend at the end of this year (i.e., D1 = $1.40). The dividend is expected to grow at a constant rate of 6% a year. The required rate of return on the stock, rs, is 18%. What is the estimated value per share of Boehm's stock? Do not round intermediate calculations.
- Sunset Corporation currently has an EPS of $2.38, and the benchmark PE for the company is 17. Earnings are expected to grow at 7.5 percent per year. a. What is your estimate of the current stock price? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. b. What is the target stock price in one year? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. Assuming the company pays no dividends, what is the implied return on the company's stock over the next year? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 1 decimal place, e.g., 32.2. a. Stock price today b. Stock price in one year c. Implied returnThe future earnings, dividends, and common stock price of Callahan Technologies Inc. are expected to grow 8% per year. Callahan's common stock currently sells for $21.75 per share; its last dividend was $1.50; and it will pay a $1.62 dividend at the end of the current year. a. Using the DCF approach, what is its cost of common equity? Do not round intermediate calculations. Round your answer to two decimal places. % b. If the firm's beta is 1.6, the risk-free rate is 8%, and the average return on the market is 12%, what will be the firm's cost of common equity using the CAPM approach? Round your answer to two decimal places. % c. If the firm's bonds earn a return of 10%, based on the bond-yield-plus-risk-premium approach, what will be rs? Use the judgmental risk premium of 4% in your calculations. Round your answer to two decimal places. % d. If you have equal confidence in the inputs used for the three approaches, what is your estimate of Callahan's cost of common equity? Do not…Mclver's Meals, Inc. currently pays a OMR2 annual dividend. Investors believe that dividends will grow at 20% next year, 12% annually for the two years after that, and 6% annually thereafter. Assume the required return is 10%. What is the current market price of the stock? Select one: O a. OMR69.30 O b.OMR75.20 O c. OMR66.60 O d. OMR60.80 O e. OMR54.99
- North Side Corp’s dividends for year 1, year 2, year 3, and expected share price for year 3 are: D1=$1.95, D2=$2.10, D3=$2.18, and P3=$95 respectively. What is the company’s current share price given the required return of 8 percent?Avondale Aeronautics has perpetual preferred stock outstandingwith a par value of $100. The stock pays a quarterly dividend of $1.00 and itscurrent price is $45.a. What is its nominal annual rate of return?b. What is its effective annual rate of return?The future earnings, dividends, and common stock price of Callahan Technologies Inc. are expected to grow 6% per year. Callahan's common stock currently sells for $27.25 per share; its last dividend was $2.00; and it will pay a $2.12 dividend at the end of the current year. Using the DCF approach, what is its cost of common equity? Do not round intermediate calculations. Round your answer to two decimal places. If the firm's beta is 0.6, the risk-free rate is 5%, and the average return on the market is 12%, what will be the firm's cost of common equity using the CAPM approach? Round your answer to two decimal places. If the firm's bonds earn a return of 10%, based on the bond-yield-plus-risk-premium approach, what will be rs? Use the midpoint of the risk premium range discussed in Section 10-5 in your calculations. Round your answer to two decimal places. If you have equal confidence in the inputs used for the three approaches, what is your estimate of Callahan's cost of common…
- Red, Inc., Yellow Corp., and BlueCompany each will pay a dividend of $2.35 next year. The growth rate in dividendsfor all three companies is 5 percent. The required return for each company’s stockis 8 percent, 11 percent, and 14 percent, respectively. What is the stock price foreach company? What do you conclude about the relationship between the requiredreturn and the stock price?Tresnan Brothers is expected to pay a $1.60 per share dividend at the end of the year (i.e., D1 = $1.60). The dividend is expected to grow at a constant rate of 9% a year. The required rate of return on the stock, rs, is 17%. What is the stock's current value per share? Round your answer to the nearest cent. $ ______ Travis Industries plans to issue perpetual preferred stock with an $11.00 dividend. The stock is currently selling for $106.00, but flotation costs will be 7% of the market price, so the net price will be $98.58 per share. What is the cost of the preferred stock, including flotation? Round your answer to two decimal places. ________ %A Share is currently selling for Rs.65. The company is expected to pay a dividend of Rs.2.50 on the share at the end of the year. It is reliably estimated that the share will sell for Rs. 78 at the end of the year. Assuming that the dividend and price forecast are accurate, would you buy the share to hold it for one year, if your required rate of return were 12per cent? Given the current price of Rs. 65 and the expected dividend of Rs. 2.50 what would the price have to be at the end of one year to justify purchase of the share today, if your required rate of return were 15% per cent?