Dividend payout rate and expected growth rate

Assignment Help Financial Management

Reference no: EM131506541

Maynard Steel plans to pay a dividend of $2.87 this year. The company has an expected earnings growth rate of 4.3 % per year and an equity cost of capital of 9.8 %.

a. Assuming? Maynard's dividend payout rate and expected growth rate remain? constant, and Maynard does not issue or repurchase? shares, estimate? Maynard's share price. The stock price is $?

b. Suppose Maynard decides to pay a dividend of $0.95 this year and use the remaining $1.92 per share to repurchase shares. If? Maynard's total payout rate remains?constant, estimate? Maynard's share price. The stock price is $?

c. If Maynard maintains the same split between divdends and? repurchases, and the same payout? rate, as in part ?(b?), at what rate are? Maynard's dividends, earnings per? share, and share price expected to grow in the? future? The growth rate will be %?

Note?:The share price is expected to also grow at the same rate as dividends and earnings per share.

Reference no: EM131506541

Questions Cloud

What is the firm value under each alternative : M&M Pies has no debt in its capital structure. What is the firm value under each alternative?

What is equivalent annual cost : The real cost of capital is 5%, and the college pays no taxes. What is the equivalent annual cost?

The contribution margin is equal to sales minus fixed costs : At the accounting break-even level, the pretax profit is equal to the aftertax profit. The contribution margin is equal to sales minus fixed costs.

What will be the amount of that withdrawal : Anna has $38,654 in a savings account that pays 2.3 percent interest. what will be the amount of that withdrawal?

Dividend payout rate and expected growth rate : Assuming? Maynard's dividend payout rate and expected growth rate remain? constant-Maynard does not issue or repurchase? shares, estimate? Maynard's share price

What price would you estimate for halliford stock : If Halliford's equity cost of capital is 8.2 % what price would you estimate for Halliford stock?

How many shares will he own after the reverse stock split : How many shares will he own after the reverse stock split? What is the anticipated price of the stock after the reverse stock split?

What is the? bonds yield to maturity : What is the? bond's yield to maturity? (expressed as an APR with semiannual? compounding)?

Project has an initial fixed asset investment : A five-year project has an initial fixed asset investment of $350,000, an initial NWC investment of $38,000, and an annual OCF of -$37,000.

User Account

All Pages