Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. q no. 2: being a newly appointed analyst at credit

Q No. 2: Being a newly appointed analyst at Credit Suisse, one of your prime...

70.2K

Verified Solution

Question

Accounting

Q No. 2: Being a newly appointed analyst at Credit Suisse, one of your prime role is to facilitate the Global head of valuations in providing detailed and timely analysis. The next meeting is being scheduled for the upcoming Saturday, and you are required to calculate the price of a few stocks and provide their valuations. The information is mentioned below:

  1. The Walgreens Boots alliance Company has recently paid dividend D0 = $3, and growth is expected to remain 5% throughout. The required rate of return is 10%. Calculate dividend streams for the next 2 years, and their PVs? (2 Marks)
  2. You have forecasted NIKE dividends of $5, $5.70, and $5.95 over the next three years respectively. After the end of three years the anticipated selling market price of NIKE will be $135. What is NIKE stock price provided a 7% expected rate of return? (3 Marks)
  3. Merck & Co. is predicted to pay Rs. 1.70 dividend in one year. Further, the market is forecasting a growth in the companys dividend by 3% per year. Given rate of return of 8% in this category, what is stock price of Merck & Co. to be in the third (3) year? (2 Mark)

Answer & Explanation Solved by verified expert
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