##### How to calculate current stock price?

 Business & Finance Tutor: None Selected Time limit: 1 Day

1.       A company is forecasted to pay a dividend of \$1.35 per share at the end of the year. That dividend is anticipated to grow at a constant rate of 8 percent per year in the future. The risk-free rate of interest is 2 percent. The firm’s beta is 1.73, and the market risk premium is 8.25 percent. The company's current stock price is \$17.62.

tThe answer is \$17.62 according to intellipath now what is the formula to get the answer?

Jul 22nd, 2015

dividends per share=1.35 and increase in the future=8%

thus 1.35*108%

1.35*108/100=1.458

risk free rate of interest is 2%

1.458*98/100=1.429

firm's beta is 1.73 market is 8.25 current stock is 17.62

Jul 22nd, 2015

Where the 108 comes from

Jul 22nd, 2015

increase in 8% and am lost please

Jul 22nd, 2015

ok

Jul 22nd, 2015

A firm’s end-of-year free cash flow is anticipated to be \$14 million. The company’s free cash flows are expected to grow 15 percent a year forever. The firm’s weighted average cost of capital is 18 percent, and the firm has 20 million common stock outstanding shares. The firm has no long-term debt in its capital structure. If the firm has \$15 million in preferred stock, the firm’s estimated intrinsic value of its common stock per share is \$​______ Do you have formulas for excel?

Jul 24th, 2015

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Jul 22nd, 2015
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Jul 22nd, 2015
May 26th, 2017
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