Problem 4-17, Company Z-prime
Principles of Corporate Finance
Brealey, Myers, and Allen
13th Edition
Calculate Z-prime’s stock price given that growth will eventually stop as the firm will pay out all its earnings as dividends.
Calculate Z-prime’s stock price given that growth will eventually stop as the firm will pay out all its earnings as dividends.
Determine the stock price for each of the stocks given that the first stock pays a constant dividend forever, the second stock has a dividend that grows each year forever, and the third stock will grow for the next five years at a high growth rate but then stops growing.
Determine EPS and dividends for years 1 through 5 by filling out a grid of numbers. Finally, determine what the stock is worth. They also give you various estimates for ROE and the payout ratio.
Determine the part of the price that is attributable to the growth opportunities, then compute CSI’s stock price after the announcement.
How much is the market paying for the growth opportunities?
Given a table of data including book equity, earnings per share, ROE, the payout ratio, dividends per share, and the dividend growth rate, estimate the stock value, the discounted value of P3, and PVGO. Finally, assume that competition will catch up with Growth-Tech: reestimate the stock value.
Determine the share price and EPS/P ratio for Premian Partners.
Determine the value of the concatenator business given a very large grid of inputs including Asset value, Free cash flows, and growth rates.
Compute the return that investors are expecting, the growth in earnings given assumptions about ROE, and the rate of return given these assumptions.
Determine the present value of the free cash flows to the firm and determine the price per share.