NORDAM Group, a firm that specializes in the design and manufacturing of aircraft components, has 130 million shares outstanding and analysts expect NORDAM to have eamings of $420 months coming year (1) NORDAM plans to pay out 57% of its eamings in dividends and they expect to use another 15% of their earnings to repurchase shares. NORDAM's equity cost of capital is 10% eamings are expected to grow rate of 3% per year and these payout rates are expected to remain constant. What is the value of one share of NORDAM stock today? OA $33.23 OB. 546.15 OC. $6.92 OD. $26.31 OE $23.26 OF. None of the above answers is within $0.05 of the correct answer
Cost of Debt, Cost of Preferred Stock
This article deals with the estimation of the value of capital and its components. we'll find out how to estimate the value of debt, the value of preferred shares , and therefore the cost of common shares . we will also determine the way to compute the load of every cost of the capital component then they're going to estimate the general cost of capital. The cost of capital refers to the return rate that an organization gives to its investors. If an organization doesn’t provide enough return, economic process will decrease the costs of their stock and bonds to revive the balance. A firm’s long-run and short-run financial decisions are linked to every other by the assistance of the firm’s cost of capital.
Cost of Common Stock
Common stock is a type of security/instrument issued to Equity shareholders of the Company. These are commonly known as equity shares in India. It is also called ‘Common equity
Only typed answer
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
