What is the value of the stock today

Assignment Help Finance Basics
Reference no: EM13290744

Microtech Corporation is expanding rapidly and currently needs to retain all of its earnings, hence it does not pay dividends. However, investors expect Microtech to begin paying dividends, beginning with a dividend of $1.25 coming 3 years from today. The dividend should grow rapidly - at a rate of 15% per year - during Years 4 and 5, but after Year 5 growth should be a constant 4% per year. If the required return on Microtech is 16%, what is the value of the stock today? Round your answer to two decimal places.

Reference no: EM13290744

Questions Cloud

Explain what is the concentration of caffeine in coke : A 12 oz can of Coke contains 46 mg of caffeine. One fluid ounce is equivalent to 29.57 mL (1 oz = 29.57 mL). What is the concentration of caffeine in Coke, in units of mg/mL
Explain what is the hard sphere atomic radius r (in nm) : You have discovered a new element with an atomic weight of 260 g/mol and a density of 30 g/cm3. If the atoms pack on a BCC lattice what is the hard sphere atomic radius R (in nm)
Calculate frequency domain representation of pre-envelope : (a) Calculate thefrequency domain representation S(f)ofthis signal (b) Calculate the frequency domain representation ofthe pre-envelope S+(f) OFS(t) (c) What is thepre-envelope s+(t) of s(t)
What is the magnitude of the gophers velocity : An eagle is flying due east at 8.9 m/s carrying a gopher in its talons. What is the magnitude of the gopher's velocity as it reaches the ground
What is the value of the stock today : If the required return on Microtech is 16%, what is the value of the stock today? Round your answer to two decimal places.
Explain what is the length of one side of cube of aluminum : The density of aluminum is determined to be 2.680 g/cm3 at 125 degrees celcius. What is the length of one side of a 1 kg cube of aluminum at 640 degrees celcius.
What is the internal growth rate : The Dog House has net income of $3,450 and total equity of $8,600. The debt-equity ratio is 0.60 and the payout ratio is 9.5 percent. What is the internal growth rate?
The ones who walk away from omelas : Write an essay comparing "The Ones Who Walk Away From Omelas" to "The Lottery." In what ways are the stories similar? In what ways are they different?
Will jennifer and johnny pass their final project : A physics teacher tells her class that their final project requires the students to measure a specific variable and determine the velocity of a car with no more than 2.5% error. Will Jennifer and Johnny pass their final project

Reviews

Write a Review

Finance Basics Questions & Answers

  Which firm or firms should expand and offer food

Phil's only Theresa's only both Phil's and Theresa's neither Phil's nor Theresa's cannot be determined from the information provided.

  What is the firms per-unit contribution

Variable costs, fixed costs, and project risk. Solutions Bank Textbooks had sales and operating expenses of $1 million last year. If the firm had fixed costs of $300,000 on sales of 35,000 books, then what is the firm's per-unit contribution?

  Analogies used to describe the theory of concepts

Analogies used to describe the theory of concepts and Cite the pages in the book where you found this analogy

  What is its economic value added

Net operating profit after taxes (NOPAT) = $700; Total assets = $2,500; Short-term investments = $200; Stockholders' equity = $1,800; Total debt = $700; and Total operating capital = $2,100. ABC's weighted average cost of capital is 10%. What is i..

  Calculation of yield to maturity of bond

Calculation of yield to maturity of Bond and What is the yield to maturity at a current market price of $829? Round the answer to the nearest hundredth

  Should the compensation consist of a dollar salary

If you were also a vice president of Company X, might your actions be different than if you were the CEO of some other company?

  Compute the eac for both machines

For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $30,000. If your tax rate is 34 percent and your discount rate is 8 percent, compute the EAC for both machines.

  Determine the break even point in dollars and in units

The Corporation makes rubber stamps which sells for $400 each; their fixed costs are $75,000 and variable expenses are $250 per rubber stamp.

  How much less magareit will have than frederico

At the end of the twenty years, how much less Magareit will have than Frederico?

  Global investment banking process

How the global investment banking process has assisted the organization in how they do business overseas.

  International aspects of financial management

Currently, you can exchange 100 for $132.66. The inflation rate in Europe is expected to be 3.1 percent as compared to 3.6 percent in the U.S.

  Depository financial institution

Create balance sheet for this depository financial institution. Describe fully with suitable reasons for your choice.

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