What is the value of ast stock, Financial Management

Brandon Michael Chu of Henry Law & Yang Yi Capital Limited believes that earnings and dividends at Alua Amanova & Shuwen Wang Technologies (AST) will continue to grow at 12% per year for 20 years. After that growth will level off to 5% for the indefinite future. The dividend just paid was $4 per share and the required rate of return on this stock is 12%.

a. What is the value of AST stock?

b. Suppose AST is currently trading at $120 per share. Expected D1 = $4.80. After that dividends will grow at 12% per year for ? number of years, then after dividends will grow at 5% per year forever. Required rate of return is 12%. How many years of growth at 12% is the market predicting?

 

Posted Date: 4/5/2013 5:39:30 AM | Location : United States







Related Discussions:- What is the value of ast stock, Assignment Help, Ask Question on What is the value of ast stock, Get Answer, Expert's Help, What is the value of ast stock Discussions

Write discussion on What is the value of ast stock
Your posts are moderated
Related Questions
Active bond management depends on an economic scenario in order to forecast the movements of yield curve. A portfolio manager skillfully builds a portfolio wit

Discuss the applicability of an operating in vegetable growing business in Uganda.

Your task is to prepare a presentation for a group of board members who are considering an investment of $100 million in your company. Your presentation will consist of three disti

which critically examines the benefits and risks to a company, of incorporating corporate debt into a portfolio of equity and debt.

Discuss the risk associated with Foreign Direct Investment. How do these risks differ from those encountered in domestic investment.

Q. Market condition Affecting cost of capital? Market condition: if an investor is purchasing a security where the risk of the investment in significant the opportunity for add

Imagine you have been allocated $100,000 which is to be invested in 8 companies listed on the Australian Stock Exchange (ASX). You are required to have a balanced portfolio betwee

Sensitivity Analysis A test of an organizations performance projections based on varying the key assumptions which is used for forecast performance.

Why does the riskiness of portfolios have to be looked at differently than the riskiness of individual assets? The riskiness of portfolios should be looked at differently as comp

i have Passed all three level of CFA program and i want to join you expert team. will you please tell me will this happen