What is the value of gillette stock if firm cost of stock

Assignment Help Financial Management
Reference no: EM131524809

Gillette Corporation will pay an annual dividend 0f $50.65 one year from now. Analyst ecpect this dividend to grow at 12% per year for the next 5 years. After that, dividend growth will level off to 2% per year. What is the value of Gillette's stock if the firm's cost of stock is 8%? $15.07.

Reference no: EM131524809

Questions Cloud

Considering the sale of new sound board : Meld Music Company is considering the sale of a new sound board used in recording studios.
Corporation is planning to issue bonds with face value : Park Corporation is planning to issue bonds with a face value of $720,000 and a coupon rate of 7.5 percent.
Comparing two different capital structures : Haskell Corp. is comparing two different capital structures. What is the EPS for each of these plans?
What is this stock expected total yield : What is this stock's expected total yield?
What is the value of gillette stock if firm cost of stock : What is the value of Gillette's stock if the firm's cost of stock is 8%? $15.07.
Sell for immediately after the firm pays the dividend : What price must you expect Evco stock to sell for immediately after the firm pays the dividend in one year to justify its current? price?
Provide to the investor with complete transparency : Explain information the firm is required to provide to the investor with complete transparency - Identify and explain the top five reasons private companies
Impact the selection of a research population : Description of two ways the guidelines in Walden University's IRB document may impact the selection of a research population.
Write a complete summary of the information : Write a complete summary of the information presented in each article, using your own words- Conduct several searches using any of the databases

Reviews

Write a Review

 

Financial Management Questions & Answers

  Making profit is not the ultimate goal

As a future healthcare manager, just making a profit is not the ultimate goal. List several reasons to incur debt and how that debt will ultimately improve the financial stability of your organization and service to your community.

  Result in initial aftertax cash savings

Scanlin, Inc., is considering a project that will result in initial aftertax cash savings of $1.86 million at the end of the first year, and these savings will grow at a rate of 2 percent per year indefinitely. The firm has a target debt–equity ratio..

  The interest was compounded semi-annually

Suppose you invest $101 in a bank account, and five years later it has grown to $138.64. What APR did you receive, if the interest was compounded semi-annually? ___%. What APR did you receive if the interest was compounded monthly?

  What is the average accounting return

A project has an initial cost of $62,000 and a four year life. The company uses straight line depreciation to a book value of zero over the life of the project. The projected net income from the project is $2,400, $4,100, $4,700, and $4,500 a year fo..

  What is the company weighted average cost of capital

YZ has target capital structure of 60% common stock, 30% debt and 10% preferred stock. The company wishes to issue new 30 years bond with 10% coupon rate. The flotation cost will be $20 and the bond has to be sold at 5% discount. What is the company’..

  What is the bond current market value-the coupon o price

What is the bond current market value: the coupon o price?

  What is the NPV of the project

Your biotech company has the opportunity to invest in a new drug project. What is the NPV of the project?

  What is the external financing need if the current sales

A firm has total assets of $162,000, long-term debt of $46,000, stockholders' equity of $95,000, and current liabilities of $21,000. The dividend payout ratio is 60 percent and the profit margin is 8 percent. Assume all assets and current liabilities..

  Solve the following problems and be able to discuss them

solve the following problems and be able to discuss them relative to the financial management of a company.thress

  Maintenance and operations costs for a piece of equipment

The maintenance and operations costs for a piece of equipment are estimated to be $700 the first month and increase by $20 per month over the equipment's 3 year life. For budgeting purposes, the owner wants to set aside a uniform amount each month to..

  Best estimate of the stocks current market value

Acme Corporation just paid a dividend of D 1 = $1.72. Analysts expect the company's dividend to grow by 10% between year 1 and 2, and at a constant rate of 5% from year 2 to 3 and continue with the 5% thereafter. The required return on this low-risk ..

  Use as the annual sales figure when evaluating this project

Winnebagel Corp. currently sells 29,000 motor homes per year at $78,000 each and 8,000 luxury motor coaches per year at $120,000 each. The company wants to introduce a new portable camper to fill out its product line; What is the amount to use as the..

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!

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