ZAPCOVID Corporation pays an annual dividend of $2.50 per share and is expected to grow...
50.1K
Verified Solution
Link Copied!
Question
Finance
ZAPCOVID Corporation pays an annual dividend of $2.50 per share and is expected to grow at the rate of 25%, 20, and 15% for the next three years respectively followed by a constant growth of 7% thereafter. The current risk free rate of return is 3% and the market risk premium is expected to be 6%. The beta for the firm under consideration is 1.5. Based on the above information, what is the intrinsic value of the firms stock?
Please show your work.
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!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Best
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.