Nicholls Enterprises Pty Ltd has been selling software supplies for the past 20 years. The company’s product line has seen very little change in the past 5 years, and the company does not expect to add any new items for the foreseeable future. Last year, the company paid a dividend of $4.45 to its ordinary shareholders. The company is not expected to grow its revenues for the next several years. If your required rate of return for such companies is 13 per cent, what is the current value of this company’s shares?
Nicholls Enterprises Pty Ltd has been selling software supplies for the past 20 years. The company’s product line has seen very little change in the past 5 years, and the company does not expect to add any new items for the foreseeable future. Last year, the company paid a dividend of $4.45 to its ordinary shareholders. The company is not expected to grow its revenues for the next several years. If your required rate of return for such companies is 13 per cent, what is the current value of this company’s shares?
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
Related questions
Question
Nicholls Enterprises Pty Ltd has been selling software supplies for the past 20 years. The
company’s product line has seen very little change in the past 5 years, and the company
does not expect to add any new items for the foreseeable future. Last year, the company
paid a dividend of $4.45 to its ordinary shareholders. The company is not expected to grow
its revenues for the next several years. If your required
is 13 per cent, what is the current value of this company’s shares?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education