Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. here are forecasts for next year for two stocks:

Here are forecasts for next year for two stocks: Stock A Stock B Return on equity 12 % 10 % Earnings per share $ 3.00 $ 2.50 Dividends...

70.2K

Verified Solution

Question

Finance

Here are forecasts for next year for two stocks:

Stock A

Stock B

Return on equity12%10%
Earnings per share$3.00$2.50
Dividends per share$2.00$2.00

a. What are the dividend payout ratios for eachfirm? (Do not round intermediate calculations. Enter youranswers as a percent rounded to the nearest wholenumber.)

Payout Rate

Stock A: ____%

Stock B: _____%


b. What are the expected dividend growth rates foreach stock? Assume dividend has a steady growth for both stocks.(Do not round intermediate calculations. Enter your answersas a percent rounded to 2 decimal places.)

Growth Rate

Stock A: _____%

Stock B:_____%


c. If investors require a return of 12% on eachstock, what are their values? (Do not round intermediatecalculations. Round final answers to 2 decimalplaces.)

PV

Stock A: _____%

Stock B:_____%

Answer & Explanation Solved by verified expert
4.2 Ratings (493 Votes)
    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

al Assignme My courses SC MATH1507 For any two events

Accounting
1.2K views

Beeler Furniture Company deposits all cash receipts eachWednesday and Friday in a night depository,...

Physics
1.2K views

A current of 10 A is maintained in a conductor of cross section 1 cm2...

Physics
1.2K views

The resistances of the four arms P Q R and S in a Wheatstone s...

Geometry
1.2K views

Question 2 10 points 2 A water slide at an amusement park follows the curve...

Geometry
1.2K views

Find the components of the vector w whose tail is C and head is the...

Algebra
1.2K views

Evaluate the algebraic expression for the given values of the variables x 3 x y...

Algebra
1.2K views

Is the signal given in 2 a single or double signal If not what are...

Accounting
1.2K views

Londen Corporation uses a job-order costing system. At the beginning of the year, the company...

Accounting
1.2K views

Colson Inc. declared a $160,000 cash dividend. It currently has 6,000 shares of 7%, $100...

Accounting
1.2K views

Please help with the explanation will rate. Entry for Jobs Completed; Cost of Unfinished...

Finance
1.2K views

A perpetuity pays $71 annually. Calculate the actual % change in the perpetuity's price if...