Problem 9.10 – Maxwell Mining Company
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition, 10th Edition, and 11th Edition
Given the declining rate, D0, and rs… find the value of the stock.
Given the declining rate, D0, and rs… find the value of the stock.
Given the expected dividend and a constant growth rate… determine the stock’s expected price 4 years from now.
Given the required return, the previous dividend, and the four constant annual rates… find the value of the stock – then given the expected growth rates… find what the growth value would be.
Given the year-end dividend, a beta, risk-free rate, market risk premium, and what the stock currently sells for… determine the constant growth rate assuming the market is in equilibrium.
Computech is expanding rapidly but does not currently pay dividends. However, investors expect Computech to start paying dividends years into the future. Given the assumptions in the problem, what is the value of a stock today?
Given the cash flows for the following years, the expected FCF growth rate, and WACC… find the horizon/continuing value and the firm’s market value today – then given debt and shares outstanding… estimate the current price per share
Given the stock price, recently paid dividend, and expected dividend growth rate… at what constant rate is the stock expected to grow after a certain year?
Find the upcoming dividends, determine the PV of the dividend stream, and the most you would be willing to pay for the stock based on your analysis.
Determine the expected dividend and capital gains yields under various scenarios and explain the relationship between dividend and capital gains.
Given an estimate of free cash flows, growth rate, and WACC… determine the present value of the free cash flows for the explicit period, calculate the horizon value, and compute the price per share.