A share of common stock has an expected long-run constant growth rate of 10 percent and is currently priced at $66 per share. If investors require a 15 percent rate of return, then what was the last dividend paid on the stock? Po = Dn (1 +Gc) __________ Ke - Gc $66 = D1 (1 + .10) _____________
The stockholder's equity section of Peter Corporation's balance sheet at December 31, 2005 was as follows: Common stock ($10 par value); authorized 1,000,000 Shares, issued and outstanding 900,000 shares $9,000,000 Additional paid-in capital 2,700,000 Retained earnings 1,300,000 Total stockholders' equity
(See attached files for full problem description) Sunny day stores operate convenience store throughout much of the United States. The industry is highly competitive, with low profit margins. The company's competition includes national, regional, and local supermarkets; oil companies; and convenience store operators. A foo
Integrated Potato Chips paid a $1 per share dividend yesterday. You expect the dividend to grow steadily at a rate of 4 percent year. A. What is the expected dividend in each of the next three years? B. If the discount rate for the stock is 12 percent, at what price will the stock sell? C. What is the expected stock
The Berenek Company, whose stock price is now $25, needs to raise $20 million in common stock. Underwritters have informed the firms management that they must price the new issue to the public at $22 per share because of signaling effects. The underwritters compensation will be 5% of the issue price so B
Will the following have high, medium or low dividend payout ratios, and why? a) company with high business risk b) a company that goes through an unexpected drop in earnings from an upward sloping trend line. c) a firm with ordinary growth, alot of borrowing capacity and high liquidity.
Colliers, Inc. has 200,000 shares of cumulative preferred stock outstanding. The preferred stock pays dividends in the amount of $2 per share, but because of cash flow problems, the company did no pay any dividends last year. The board of directors plans to pay dividends in the amount of $1million this year. What amount will
Briefly discuss the three important dates for a dividends.
The owners' equity accounts for a company are shown here: Common stock ($1 par value) $ 10,000 Capital surplus 194,000 Retained earnings 633,000 ====== Total owners' equity $837,000
29. Cellular Systems paid a $3 dividend last year. The dividend is expected to grow at a constant rate of 5 percent over the next two years. The required rate of return is 12 percent (this will also serve as the discount rate in this problem). Round all values to three places to the right of the decimal point where appropriate.
The following data applies to my company: Net Income $ 300,000,000 Total Capital Budget $ 100,000,000 Debt/Asset Ratio WACC 0% 14.0% 10% 13.7% 20% 13.4%
I need help with a problem that I have the solution to but need to know how it's done so I can study for a test: Annual dividends for Adams Mills are as follows: year 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 div. .00 .10 .10 .10 .10 .10 .10 .12 .15
Karlo Corporation is considering an initial public offering. Other firms in the same mature industry as Karlo (each of whom has traded publicly for at least five years) include the following. Each of these firms (including Karlo) has negligible levels of debt. Also listed is the Standard & Poors 500, an index of large US stocks.
1-Perpetual Dividend Growth - A company just paid a divided of $3.00. If the dividends will grow at 5.5% per year and you require a return of 11.8 %, what is the most you should be willing to pay for the stock? 2- Perpetual Dividend Growth - Star Light & Power increases its dividend 5% per year every year. This utility is val
Cellular Systems paid a $3 dividend last year. The dividend is expected to grow at a constant rate of 5 percent over the next two years. The required rate of return is 12 percent (this will also serve as the discount rate in this problem). Round all values to three places to the right of the decimal point where appropriate.
100. A company stock has a current market value of 40.50. The co. just paid a dividend = to 1.50 per share, which is expected to grow at a constant rate forever into the future. If the co. marginal investors require a rte of return = to 12%, what is the rate at which dividends are expected grow in the future. 8.3% 12.0 4,
99. A company paid a dividend of 1.30 yesterday. The next dividend will be in one year and is expected to be 1.50. After that, dividends are expected to grow at a constant 15% foreever. The discount rate for the co. is 25%. What should be the market price 17.25 15.00 13.20 13.80 18.75
What advantages to the corporation and the stockholder do dividend reinvestment plans offer?
Need help Mr. Burton owns 58,000 of the 100,000 outstanding shares of Mirkwood stock with a $50 basis per share. He wants to retire from business, and Mirkwood?s board of directors has offered to redeem any number of his shares for FMV ($120 per share). Mr. Burton wants to surrender enough shares so that the redemption will
I am evaluating a firm using the three-stage dividend growth model with a linearly declining growth rate in Stage 2. I am using the following information (as of the start of 2004): * Current dividend is $0.39 * I estimate the required rate of return on the stock at 8.72% * In stage 1, the dividend will grow at 11.3 percent
Which of the following factors does not contribute to dividends' effects on a firm's value? a. Corporate taxes b. Transactions costs c. Flotation costs
I need help with dividend calculations.