Question

Company B is expected to pay dividends of $1.35 every 6 months for the next 4 years. If the current price of Company B stock is $100, and Company B's equity cost of capital is 4.5%. What price would you expect the stock to sell for at the end of 4 years? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an answer."

Answer #1

I hope my efforts will be fruitful to you....?

Coolibah Holdings is expected to pay dividends of $ 1.40 every
six months for the next three years. If the current price of
Coolibah stock is $ 21.60, and Coolibah's equity cost of capital
is 16%, what price would you expect Coolibah's stock to sell for
at the end of three years?
A. $ 28.81
B. $ 24.01
C. $ 27.61
D. $ 26.41

Darrens Holdings is expected to pay dividends of $1.00 every six
months for the next three years. If the current price of Darrens
stock is $22.70, and Darrens's equity cost of capital is 18%,
what price would you expect Darrens's stock to sell for at the end
of three years?

Company F will have earnings per share of $5 this year and
expect that they will pay out $2 of these earnings to shareholders
in the form of a dividend. Company F's return on new investments is
10% and their equity cost of capital is 13%. The expected growth
rate for Company F's dividends is ________. Note: Express your
answers in strictly numerical terms. For example, if the answer is
5%, enter 0.05 as an answer."

"An auto-parts company is deciding whether to sponsor a racing
team for a cost of $1000000. The sponsorship would last for 4 years
and is expected to increase cash flows by $300000 per year. If the
discount rate is 8%, what will be the change in the value of the
company if it chooses to go ahead with the sponsorship? Note:
Express your answers in strictly numerical terms. For example, if
the answer is $500, write enter 500 as an...

2.hw5
"Company ZZZ is an all-equity firm with 200,000,000 shares
outstanding. Company ZZZ currently has a cash flow of $100,000,000
USDs and expects future free cash flows of $50,000,000 per year.
Management plans to use the cash to expand the firm's operations,
which will in turn increase future cash free cash flows to
$200,000,000 per year. If the cost of capital of Company ZZZ's
investments is 7%, calculate the stock price for the company if the
expansion where to happen....

ABC is expected to pay a dividend of $1.25 every six months for
the next four years. The current share price is $25.76 and the
relevant discount rate is 14% (compounded semi-annually). What do
you expect the share price at the end of year 4 to be?
a. $28.82
b. $26.74
c. $31.44
d. $25.12

ABC is expected to pay a dividend of $1.25 every six months for
the next four years. The current share price is $25.76 and the
relevant discount rate is 14% (compounded semi-annually). What do
you expect the share price at the end of year 4 to be?

"A coupon bond that pays interest annually has a par value of
$1000, matures in 5 years, and has a yield to maturity of 6%. If
the coupon rate is 10%, the value of the bond today will be
__________. Note: Express your answers in strictly numerical terms.
For example, if the answer is $500, write enter 500 as an
answer."

"A coupon bond that pays interest quarterly has a par value of
$1000, matures in 5 years, and has a yield to maturity of 16%. If
the coupon rate is 10%, the value of the bond today will be
__________. Note: Express your answers in strictly numerical terms.
For example, if the answer is $500, write enter 500 as an
answer."

QUESTION 5
"Axon Industries needs to raise $1,000,000 USDs for a new
investment project. If the firm issues 1-year debt, it may have to
pay an interest rate of 9%, although Axon's managers believe that
6.5% would be a fair rate given the level of risk. If the firm
issues equity, they believe the equity may be underpriced by
9%.What is the cost (in USDs) to current shareholders of financing
the project out of retained earnings? Note: Express your answers...

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