Using information below, calculate value of one share of company X: 2021 2022 2023 2024 EPS growth rate (%) 15 12 10 6 Dividend per share (% of EPS) 20 30 40 50 The company has net profit after tax of $12.32 million and 4 million shares outstanding in 2020. The value of the company (that is the terminal value) at the end of 2024 is expected to be 6 times of earnings of 2024. The required return on equity is 12 percent

Using information below, calculate value of one share of company X: 2021 2022 2023 2024 EPS growth rate (%) 15 12 10 6 Dividend per share (% of EPS) 20 30 40 50 The company has net profit after tax of $12.32 million and 4 million shares outstanding in 2020. The value of the company (that is the terminal value) at the end of 2024 is expected to be 6 times of earnings of 2024. The required return on equity is 12 percent

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Consider company ABC. Today it is 1st of January 2023 and ABC has just paid a dividend of £3 million. The expected earnings of ABC for the next 30 years are forecast to grow at a rate of 15% per annum. From 1st of January 2053 and onwards the earnings of ABC are expected to grow at a rate of 5%. The required rate of return of ABC is 12% per annum. The current dividend policy of ABC is such that they pay out 50% of its earnings as dividends (assume that they pay their dividends on 1st of January every year). Suppose that the dividend payout ratio is expected to stay constant in the future. What is the value of ABC stock? Show and explain your calculations and any assumptions you make. 2) Just after the dividend payment on 1st of January 2043, ABC is planning to reduce their dividends and only pay out 40% of its earnings. What is the value of ABC under the new dividend policy?
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Common stock value: Constant growth Seagate Technology is a global leader in data storage solutions and a consistent dividend payer. From 2018 through 2022. Seagate paid the following per-share dividends: Year Dividend per share 2022 2021 2020 2019 2018 $2.53 2.21 1.83 1,24 1.48 Assume that the historical annual growth rate of Seagate dividends is an accurate estimate of the future constant annual dividend growth rate, Use a 18% required rate of return to find the value of Seagate's stock immediately after it paid its 2022 dividend of $2.53. The value of Seagate's stock is $ (Round to the nearest cent)
A company is expected to pay out 40% of its expected earnings per share of €0.5 next year as dividends. The earnings are expected to grow 2% per year in perpetuity and the cost of equity is 7%. Supposing that the company is a stable growth dividend paying, calculate the expected PE ratio. P/E=Payout ratio*(1+g)/(r-g) A. 4 B. 8 C. 10 D. 20 E. 25
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What is the average annual growth rate for Duke Energy's recent dividends? Year annual dividends 2022 $ 1.68 1.56 1.44 1.32 1.20 2021 2020 2019 2018
Use the historical dividend data below to calculate the constant growth rate, estimate the price of O'Brien Ltds’ common stock knowing that the investor has an 19% required rate of return. 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 $0.41 $0.48 $0.56 $0.65 $0.75 $0.88 $0.99 $1.10 $1.13 $1.39 Question 10Answer a. g= 17.50% and Price (P0) = $56.43 b. g= 14.04% and Price (P0) = $31.49 c. g= 27.4% and Price (P0) = $300.81 d. g= 14.53% and Price (P0) = $35.60
Common stock value: Constant growth Seagate Technology is a global leader in data storage solutions and consistent dividend payer. From 2018 through 2022, Seagate paid the following per-share dividends: Year Dividend per share 2022 2021 2020 2019 2018 $2.56 2.22 1.88 1.19 1.56 Assume that the historical annual growth rate of Seagate dividends is an accurate estimate of the future constant annual dividend growth rate. Use a 20% required rate of return to find the value of Seagate's stock immediately after it paid its 2022 dividend of $2.56. The value of Seagate's stock is $. (Round to the nearest cent.)
From the financial statements of Company A for the year 2022, we read the following information: Book value of equity = $100 millions, Net income = $20 millions. Distributed Cash dividend = $12 millions. There are 10 millions common shares of the company in circulation. Answer the following questions, assuming the required return of 10%. What would be its expected value at the end of 5 years, namely P5? a. 26.32 b. 15.62 c. 17.63 d . 10.65
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 $71.85
If XYZ Company has 2023 earnings per share of $3 and its growth rate is 9%, how long will it take XYZ to double its earnings per share?