The risk-free rate of return is 6.5%, the expected rate of return on the market portfolio is 13%, and the stock of Xyrong Corporation has a beta coefficient of 2.7. Xyrong pays out 50% of its earnings in dividends, and the latest earnings announced were $20 per share. Dividends were just paid and are expected to be paid annually. You expect that Xyrong will earn an ROE of 25% per year on all reinvested earnings forever.

a. What is the intrinsic value of a share of Xyrong stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Intrinsic value $ _______________

b-1. If the market price of a share is currently $96, and you expect the market price to be equal to the intrinsic value one year from now, calculate the price of the share after one year from now. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Price $ __________

b-2. What is your expected one-year holding-period return on Xyrong stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Expected one-year holding-period return _________ %

Income before interest-depreciation and taxes : The MoMi Corporation’s income before interest, depreciation and taxes, was $2.4 million in the year just ended, and it expects that this will grow by 5% per year forever. To make this happen, the firm will have to invest an amount equal to 18% of pre.. |

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What is the intrinsic value of a share of xyrong stock : The risk-free rate of return is 6.5%, the expected rate of return on the market portfolio is 13%, and the stock of Xyrong Corporation has a beta coefficient of 2.7. Xyrong pays out 50% of its earnings in dividends, and the latest earnings announced w.. |

Training plan and area of focus guidelines : For Milestone Two, you will submit a written report in which you discuss how you will approach training the new technical Mobile Division management team and communicating the new guidelines to existing employees. |

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