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

  Target capital structure-preferred-debt and common equity

You were hired as a consultant to XYZ Company, whose target capital structure is 29% debt, 11% preferred, and 60% common equity. The interest rate on new debt is 6.80%, the yield on the preferred is 5.75%, the cost of common from retained earnings is..

  Implement cash management systems

If a company can implement cash management systems and save three days by reducing remittance time and one day by increasing disbursement time based on $2,000,000 in average daily remittances and $2,500,000 in average daily disbursements and their re..

  What was the average real risk premium

What was the average real risk-free rate over this time period? What was the average real risk premium?

  Strategy for starbucks

Recommend one or two strategies for the company. Also include a generic strategy the company currently is using or what you think they should be using.

  Ross creek ltd

On 3 August 2011 Ross Creek Ltd declared and paid a dividend of $10000 from profits earned prior to its acquisition by Sebastopol Ltd. The directors consider that the value of the investment in Ross Creek Ltd has been impaired and have adjusted the p..

  A derivative is a financial instrument

A derivative is a financial instrument whose value is determined by which of the following?

  Bond portfolio using price sensitivity hedge ratio

A bond portfolio is worth $24,000,000 today. The futures price for a Treasury note futures contract is $110,000 and each contract is for the delivery of bonds with a face value of $100,000. How many contracts are necessary for hedging the bond portfo..

  Average accounts receivable figure

Skye Flyer, Inc., has weekly credit sales of $48,400, and the average collection period is 18 days. What is the average accounts receivable figure?

  Use the exact form of interest rate parity

Lakonishok Equipment has an investment opportunity in Europe. The project costs €10 million and is expected to produce cash flows of €1 million in Year 1, €1.4 million in Year 2, and €2.5 million in Year 3. Use the exact form of interest rate parity ..

  How might inflation targeting affect output stability

In theory, how might inflation targeting affect output stability?  -  What do the Ball-Sheridan data say about this issue?

  Depreciated by the straight line method

Tocserp is considering the purchase of a new machine that will produce widgets. The widget maker will require an initial investment of $10,000 and has an economic life of five years and will be fully depreciated by the straight line method.

  Eliminate the risk of changes in the exchange rate

the firm chooses to avoid any hedging techniques designed to reduce or eliminate the risk of changes in the exchange rate.

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