A company has a P/E of 30, and the current price is $52.50. The company is committed to a dividend payout ratio of 45%. What is the expected dividend (rounded to 2 decimal places)?
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A firm has a steady and stable gross profit margin with slow…
A firm has a steady and stable gross profit margin with slow but positive revenue growth however, their EBITDA margin continues to fall. The company operates in a fiercely competitive industry that is mature. What is the likely cause of this scenario?
A firm’s CFO wants to estimate the firm’s WACC, and has comp…
A firm’s CFO wants to estimate the firm’s WACC, and has compiled the following information below. The firm uses CAPM to estimate the cost of equity, and does not account for any kind of floatation costs in the calculation of the cost of capital. What is the firm’s WACC? Capital structure 60% equity Bonds outstanding yield 8.75% Real-risk free rate 5% Market risk premium 6% Beta 1.4 Tax rate 40%
You’ve just done some analysis on a publicly traded company…
You’ve just done some analysis on a publicly traded company and some of your key findings are below. The company; Operates in a highly innovative and high growth industry which is expected to continue for the next 5 years before the industry matures The company is an industry leader with some of the best metrics relative to peers Has an ROE of 15% Operates in a world where GDP is approximately 5% Does not pay a dividend Given these considerations, what is the most appropriate sustainable growth rate (terminal value growth rate) to use for this company?
A company has a high debt to assets ratio and a low interest…
A company has a high debt to assets ratio and a low interest coverage ratio. What ratio below should you be paying close attention to in an effort to evaluate the financial position of the company should they experience some adverse negative exogenous shock?
If the investor has required rate of return is 15.63% based…
If the investor has required rate of return is 15.63% based on CAPM, the risk-free rate is 1%, and the market risk premium is 11%, what is the Beta of the company?
Assuming the company has a dividend payout ratio of 25% of e…
Assuming the company has a dividend payout ratio of 25% of earnings and the long term expected growth rate for dividends is 5%, what is the current value of the firm considering a discount rate of 12%?
If Luna Enterprises had the following forecasted dividend pa…
If Luna Enterprises had the following forecasted dividend payments, a terminal growth rate of 1%, and a discount rate of 9%, what would the firm be worth? Time Period 1 2 3 4 Dividend 1.97 1.99 2.05 2.12
The current price of a company is $34.5, the discount rate f…
The current price of a company is $34.5, the discount rate for the firm is 8%. The most recent cashflow is $1.88. What is the market implied growth rate, assuming the firm is currently fairly valued?
What is the present price of a stock that paid $2.40 in divi…
What is the present price of a stock that paid $2.40 in dividends last year, has a constant dividend growth rate of 5%, and reflects a required rate of return of 10%?