Zegna expects to earn $10 per share next year. The firms ROE is 20% and...
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Zegna expects to earn $10 per share next year. The firms ROE is 20% and its plowback ratio is 50%. The risk free rate in the market is 6% while the market premium if 7%. The beta for Zegna is 2.0.
- Calculate the price with constant growth model.
- Calculate the price with no growth
- What is the present value of its growth opportunities?
Please show your work.
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