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- Beta of a project. Magellan is adding a project to the company portfolio and has the following information: the expected market return is 12.7%, the risk-free rate is 2.4%, and the expected return on the new project is 16.5%. What is the project's beta? What is the project's beta? (Round to three decimal places.)NikulGiven that the NPV per share of the reinvestment of the retained earnings next year for a firm is $2.50. Assuming the growth of the NPV is constant at 5% each year, with the required return rate of 12%, what is the estimated Present Value of Growth Opportunity (PVGO)? a. $35.71 b. $59.23 c. $46.75 d. $24.56
- Give typing answer with explanation and conclusion 1. If the value of sustainable investing is $171.1 and the discount rate is 8% while the value of non-sustainable investing is $15.7 and the company has a 28.7% probability of being sustainable. What is the expected value today of the company given a 18 year horizon? (Answer to 2 decimal places in $).For this question, use the American Eagle Outfitters 2016 10Ks and 2017 Q1 10Q from the previous questions. Your Managing Director asks you to include valuations based on Comparable Forward PE multiples given that peer capital structures have been relatively similar. She asks you to assume a 14x PE multiple on forward diluted EPS, and a 10% growth rate over LTM diluted EPS to calculate forward EPS, which is being assumed by industry analysts. Using the aforementioned assumptions for Comparable Transactions’ PE multiples, what is the implied AEO share price based on the latest data provided to you from its Corporate filings as of June 2017? 15.12 16.63 16.79 17.86A venture will provide a net cash inflow of $57,000 in Year 1. The annual cash flows are projected to grow at a rate of 7 percent per year forever. The project requires an initial investment of $739,000 and has a required return of 15.6 percent. The company is somewhat unsure about the growth rate assumption. At what constant rate of growth would the company just break even? O 9.48% O 9.29% O 7.89% O 8.49% A Moving to another question will save this response. «< Question 15 of 30
- You have assigned the following values to these three firms: Upcoming Dividend $0.50 Estee Lauder Kimco Realty Nordstrom Price $36.00 75.00 11.00 1.58 2.00 Estee Lauder required return Kimco Realty required return Nordstrom required return Assume that the market portfolio will earn 17.20 percent and the risk-free rate is 8.20 percent. Compute the required return for each company using both CAPM and the constant-growth model. (Do not round intermediate calculations and round your final answers to 2 decimal places.) CAPM Growth 11.40% 17.00 8.80 % % % Beta 0.92 1.28 1.24 Constant-Growth Model % % %Intrinsic valuation. Given the following: Free cash flows: year 1: -$15m year 2: $25m year 3: $30m WACC = 10%. After 3 years, cash flows will grow at a constant 4% $15m in marketable securities, $80m in debt, and 1 million in shares calculate: a. the horizon value b. the current value of operations c. the intrinsic value per share (Show all work)Give typing answer with explanation and conclusion A company is expected to maintain its dividend payout ratio of 70% in the long term. The earnings per share of the company are expected to be $1.575 next year. Earnings are expected to grow at a constant rate of 5% per year. The current risk-free rate is 1%, the implied equity risk premium is 7.0%, and the estimated beta of the firm is 2.10. If the firm is currently trading in the market at a P/E of 13.5, which of the following statements is correct A) firm correctly priced B) firm overvalued C) firm undervalued
- Parcel Corporation expects to pay a dividend of $5.15 per share next year, and the dividend payout ratio is 50 percent. If dividends are expected to grow at a constant rate of 8 percent forever, and the required rate of return on the stock is 13 percent, calculate the present value of growth opportunities. Multiple Choice O O O $103.00 $79.23 $23.77 $71.85Beta of a project. Magellan is adding a project to the company portfolio and has the following information: the expected market return is 10.8%, the risk-free rate is 2.5%, and the expected return on the new project is 14.4%. What is theproject's beta? What is the project's beta? (Round to three decimal places.)(1)Find the required rate of return on Oakfield stocks? (ii)What is the beta of the company's existing portfolio of assets? 4. Kangaroo and Kimiti Co.Ltd is attempting to evaluate the feasibility of investing tshs 95 million in a piece of equipment with a five year lifespan. The company has estimated the profits after taxes and cash inflows associated with the project as follows: Year Profit after Cash flow("000") taxes("000") 1 انه ای 2 3 4 5 5000 3000 9000 14000 19000 The company has 12% cost of capital. 6/17/2021 8:05:06 PM 20000 25000 30000 35000 40000 Page 1 of 2
