Krell Industries has a share price of $21.02 today. If Krell is expected to pay a dividend of $0.79 this year and its stock price is expected to grow to $23.73 at the end of the year, what is Krell's dividend yield and equity cost of capital? The dividend yield is %. (Round to two decimal places.)
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- Krell Industries has a share price of $21.81 today. If Krell is expected to pay a dividend of $1.18 this year and its stock price is expected to grow to $24.71 at the end of the year, what is Krell's dividend yield and equity cost of capital? The dividend yield is%. (Round to one decimal place.)HighGrowth Company has a stock price of $17. The firm will pay a dividend next year of $1.09, and its dividend is expected to grow at a rate of 3.7% per year thereafter. What is your estimate of HighGrowth's cost of equity capital? The required return (cost of capital) of levered equity is %. (Round to one decimal place.)Next year, BHH Co. is expected to pay a dividend of $3.12 per share from earnings of $4.98 per share. The equity cost of capital for BHH is 12.3%. What should BHH's forward P/E ratio be if its dividend growth rate is expected to be 4.2% for the foreseeable future? The forward P/E ratio is (Round to two decimal places.)
- Slow 'n Steady, Inc., has a stock price of $28, will pay a dividend next year of $2.95, and has expected dividend growth of 1.7% per year. What is your estimate of Slow 'n Steady's cost of equity capital? The required return (cost of capital) of levered equity is%. (Round to one decimal place.)Gremlin Industries will pay a dividend of $1.65 per share this year. It is expected that this dividend will grow by 5% per year each year in the future. The current price of Gremlin's stock is $22.20 per share. What is Gremlin's equity cost of capital?HighGrowth Company has a stock price of $21. The firm will pay a dividend next year of $0.86, and its dividend is expected to grow at a rate of 3.5% per year thereafter. What is your estimate of High Growth's cost of equity capital? The required return (cost of capital) of levered equity is %. (Round to one decimal place.)
- Oriole Wok Co. is expected to pay a dividend of $1.6 one year from today on its common shares. That dividend is expected to increase by 5% every year thereafter. If the price of Oriole common stock is $ 20, what is the cost of its common equity capitalIn early 2018, Coca-Cola Company (KO) had a share price of $43.36, and had paid a dividend of $1.48 for the prior year. Suppose you expect Coca-Cola to raise this dividend by approximately 6.2% per year in perpetuity. a. If Coca-Cola's equity cost of capital is 8.5%, what share price would you expect based on your estimate of the dividend growth rate? b. Given Coca-Cola's share price, what would you conclude about your assessment of Coca-Cola's future dividend growth?The Fl Corporation's dividends per share are expected to grow indefinitely by 8% per year. Required: a. If this year's year-end dividend is $3.00 and the market capitalization rate is 10% per year, what must the current stock price be according to the DDM? Note: Round your answer to 2 decimal places. b. If the expected earnings per share are $9.00, what is the implied value of the ROE on future investment opportunities? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. c. How much is the market paying per share for growth opportunities (i.e., for an ROE on future investments that exceeds the market capitalization rate)? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. a. Current stock price b. Value of ROE c. Amount % per share
- Sheridan, Inc., is expected to grow at a constant rate of 6.50 percent. If the company’s next dividend, which will be paid in a year, is $1.99 and its current stock price is $22.35, what is the required rate of return on this stock? (Round intermediate calculations to 4 decimal places, e.g. 1.5325 and final answer to 2 decimal places, e.g. 17.54%.)Stewart Industries expects to pay a $3.00 per share dividend on its common stock at the end of the year (i.e. D1 = $3.00). The dividend is expected to grow 25 percent a year until t = 3, after which time the dividend is expected to grow at a constant rate of 5 percent a year (i.e. D3 = $4.6875 and D4 = $4.9219). The stock’s beta is 1.2, the risk-free rate of interest is 6 percent, and the market risk premium (i.e., rm –rrf) is 5 percent. What is the company’s current stock price?The 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…
