User Account

All Pages

Price of one share of caramel stock

Assignment Help Finance Basics
Reference no: EM131429053

Caramel Corporation is expected to pay quarterly dividends (starting in three months) of $0.35 per share. The dividend amount is expected to remain constant for the foreseeable future. Given the risk inherent in Caramel shares, the required expected return for investors is 16% per year (effective).

a) Using the dividend-discount model, what would be the price of one share of Caramel stock?

b) What would be the price of one share of its stock if the next dividend is in one month, not three months?

c) Say the next dividend is in 3 months, as in part a). If dividends are expected to grow at a rate of 1% per quarter, what would be the price of one share of Caramel stock?

Reference no: EM131429053

Questions Cloud

Unibody eps to estimate the price of stock : a) If the average industry P/E ratio is 9.1, use Unibody's EPS to estimate the price of its stock. b) If the average industry EV/EBITDA multiple is 10.2, use Unibody's EBITDA to estimate the price of its stock.
In regards to labor relations : In regards to Labor relations. What are the most important advantages of having a unionized workforce? What are some negative outcomes of having labor unions? How do other countries perceive the role of labor unions in their workforce?
Difference between person-focused pay and job-based pay : What is the difference between person-focused pay and job-based pay. Discuss why many organizations view person-focused pay negatively and would prefer not to implement within their organization.
Determine the combined spring constant k : Knowing that the amplitude of the motion of the element at that speed is 15 mm and that the total mass of the system is 140 kg,
Price of one share of caramel stock : a) Using the dividend-discount model, what would be the price of one share of Caramel stock? b) What would be the price of one share of its stock if the next dividend is in one month, not three months?
Employee benefits negotiation : On Wednesday, March 2, Fred Daily, a student intern in the human resource management office of the Houston Manufacturing Company (HMC), was working in the office that had been assigned to him. HMC is a unionized automobile parts manufacturer in Westv..
What is the role of ethics in supply-chain management : How did the sanlu milk crisis arise? Who should be deemed responsible for the crisis and why do companies outsource? What are the pros and cons of outsourcing?
Discuss about the strategies for creative problem solving : For that problem use these three methods: the Four Classical virtues, Ethics Checklist, and the Five P's to help you analyze the problem. Then write at least one paragraph (Short Essay Format, not List Format) for each of the three methods.
Paid interest on january : Kershaw electric sold $4,040,000, 14% 10-year bonds on January 1, 2017. The bonds were dated January 1, 2017 and paid interest on January 1. The bonds were sold at 96. Prepare a journal entry for January 1, 2017.

Reviews

Write a Review

Finance Basics Questions & Answers

  Select two of the many capital structure concepts such as

select two of the many capital structure concepts such as modigliani and miller pecking order theory leverage and so on

  What was the addition to net working capital

If net fixed assets increased by $25,000 during the year, what was the addition to net working capital?

  Analyse international banks risk management procedures

International banks tend to operate differently in different economies to maximise shareholders' value. Critically analyse international banks risk management procedures

  Budget what is a final

what is a final

  Working capital management

Working Capital Management

  Select a stock of interest

Select a stock of interest (NOT Dicks Sporting Goods) and study it by going to its equity menu and accessing the following sub-screens (to select a company, type in the ticker at the blue blinking prompt and choose it from the drop down menu):

  Calculate the after-tax cost of preferred stock for

calculate the after-tax cost of preferred stock for bozeman-western airlines inc. which is planning to sell 10 million

  Mints retained earnings balance

At the end of the year its balance sheet showed retained earnings of $250,000. What was Mints' retained earnings balance at the end of 2005?

  A firm is considering bidding on a project to produce eight

a firm is considering bidding on a project to produce eight widgets per year for the next four years. in order to

  What maximum growth rate can drazi achieve

Drazi, Inc.'s profit margin is 15%, total asset turnover is 0.8, equity multiplier is 1.25, and dividend payout ratio is 45%. The firm has no plan to raise funds externally, only counting on its own retained earnings to support growth. What maximu..

  Lashi and hsipaw railways ltd is currently unleveredie it

lashi and hsipaw railways ltd is currently unleveredi.e. it has 100 equity and no debt. there are 1000000 shares on

  If a stocks pe ratio is 135 at a time when earnings are 3

if a stocks pe ratio is 13.5 at a time when earnings are 3 per year what is the stocks current

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd