Moore's historical dividends are shown in the following table:. Find the required rate of return for this stock, assuming the future dividend growth rate will remain the same and the company has an infinite horizon. Assume the January 1, 2023price of the stock was $45What was the required return for Moorestock? What was the estimated annual required return for Moore's stock? % (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Year Dividend 2017 $1.01 2018 $1.07 2019 $1.12 2020 $1.31 2021 $1.45 2022 $1.90 - X

Moore's historical dividends are shown in the following table:. Find the required rate of return for this stock, assuming the future dividend growth rate will remain the same and the company has an infinite horizon. Assume the January 1, 2023price of the stock was $45What was the required return for Moorestock? What was the estimated annual required return for Moore's stock? % (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Year Dividend 2017 $1.01 2018 $1.07 2019 $1.12 2020 $1.31 2021 $1.45 2022 $1.90 - X

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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Chris Luna is researching the DuPont Corporation. The following is the current stock listing: Price is $48.75, and the 52 week range $39 $49. Average earnings per share is $3.20 and the dividend is $1.47 (a) What is the P/E ratio to the nearest whole number? (b) What is the yield to the nearest hundredth?
Select a publicly traded company that pays dividend. Go to www.yahoofinance.com and download the dividend data for the selected company and one of its competitors’ stock for the last 10 years (2012-2022). Use Excel to calculate annual dividends and the annual growth rate in dividends for the two companies. Questions: 1. Based on historical growth rates in dividend, will the forecasted growth in dividend be constant or non-constant? Explain.
The next dividend payment by Hoffman, Inc., will be $2.70 per share. The dividends are anticipated to maintain a growth rate of 6.75 percent forever. Assume the stock currently sells for $49.00 per share. a. What is the dividend yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the expected capital gains yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
The future earnings, dividends, and common stock price of Callahan Technologies Inc. are expected to grow 5% per year. Callahan's common stock currently sells for $22.50 per share; its last dividend was $1.60; and it will pay a $1.68 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 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. % 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. % 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…
You are evaluating a company's stock. The stock just paid a dividend of $1.75. Dividends are expected to grow at a constant rate of 5 percent for a long time into the future. The required rate of return (Rs) on the stock is 12 percent. What is the fair present value? Please show all the steps, including the equation(s).
Suppose Stark Ltd. just issued a dividend of $2.08 per share on its common stock. The company paid dividends of $1.75, $1.82, $1.89, and $2.00 per share in the last four years. a. If the stock currently sells for $55, what is your best estimate of the company’s cost of equity capital using the arithmetic average growth rate in dividends? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. What if you use the geometric average growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Suppose you know that a company's stock currently sells for $66.60 per share and the required return on the stock is 11 percent. You also know that the total return on the stock is evenly divided between capital gains yield and dividend yield. If It's the company's policy to always maintain a constant growth rate In its dividends, what is the current dividend per share? Note: Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Dividend per share
The stock price of Alps Co. is $53.50. Investors require a return of 13 percent on similar stocks. If the company plans to pay a dividend of $3.40 next year, what growth rate is expected for the company’s stock price? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
You found the following stock quote for DRK Enterprises, Incorporated, at your favorite website. You also found that the stock paid an annual dividend of $0.75, which resulted in a dividend yield of 1.60 percent. Company DRK Enterprises Closing price Symbol Volume Close DRK 18,649, 130 ?? DAILY Change 0.26 Traded lots a. What was the closing price for this stock yesterday based on today's closing price? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. b. How many round lots of stock were traded? Note: Round your answer to the nearest whole round lot. Change 0.55% YTD %Change 8.73% High 78.19 52 WEEK Low 29.46 Change 11.0%
Assume that a share of stock just paid (yesterday) a dividend (Do) of $2.00 per share, has a required rate of return of 6 percent, and has a constant dividend growth rate of 2 percent. Also assume that the stock's price is in equilibrium so that expected rates are equal to required rates of return. Given this information, determine what percentage of the stocks current price (value) is derived from the dividends expected to be received in Years 11-22. 23.48% 29.84% O 28.34% 26.79% 25.17%
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 $25.75 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 1.1, the risk-free rate is 3%, and the average return on the market is 14%, 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 12%, 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. % 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 round…
Use the Dividend Discount Model to determine the expected annual growth rate of the dividend for ELO stock. The firm is expected to pay an annual divided of $3.07 per share in one year. ELO shares are currently trading for $27.81 on the NYSE, and the expected annual rate of return for ELO shares is 16.58%. Answer as a % to 2 decimal places (e.g., 12.34% as 12.34). Answer:

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