15. Nonconstant Growth Metallica Bearings, Inc., is a young startup company No dividends will be paid on the stock over the next nine years because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $14 per share 10 years from today and will increase the dividend by 3.9 percent per year, thereafter. If the required return on this stock is 11.5 percent, what is the current share price?
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- Metallica Bearings, Inc., is a youngstart-up company. No dividends will be paid on the stock over the next nine yearsbecause the firm needs to plow back its earnings to fuel growth. The company will pay a$17 per share dividend 10 years from today and will increase the dividend by 3.9 percentper year thereafter. If the required return on this stock is 12.5 percent, what is the currentshare price?A young company currently does not pay a dividend. The company retains all its earnings to finance its growth. However, 10 years from now the company is expected to start paying a $1.50 dividend. According to analysts, the dividend should then grow by 5% annually forever. If the required return on the share investment is 15%, what should be the company's share price five years from today? a. $16.28 b. $8.57 c. $11.50 d. $6.24Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next eight years, because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $15.25 per share 9 years from today and will increase the dividend by 5.75 percent per year thereafter. Required: If the required return on this stock is 13.75 percent, what is the current share price? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Current share price S
- Metallica Bearings, Inc., is a young start-upcompany. No dividends will be paid on the stock over the next nine years becausethe fi rm needs to plow back its earnings to fuel growth. The company will pay a$10 per share dividend in 10 years and will increase the dividend by 5 percent peryear thereafter. If the required return on this stock is 14 percent, what is the currentshare price?Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 10 years because the firm needs to plow back its earnings to fuel. growth. The company will then pay a dividend of $13.50 per share 11 years from today and will increase the dividend by 5.25 percent per year thereafter. If the required return on this stock is 13.25 percent, what is the current share price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. Current share priceMetallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 10 years because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $13.50 per share 11 years from today and will increase the dividend by 5.25 percent per year thereafter. If the required return on this stock is 13.25 percent, what is the current share price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price
- Microtech Corporation is expanding rapidly and currently needs to retain all of its earnings, hence it does not pay dividends. However, investors expects Microtech to begin paying dividends, beginning with a dividend of $1.00 coming 3 years from Today. The dividend should grow rapidly-at a rate of 50 percent per year-during Years 4 and 5, but after Year 5 growth should be constant 8 percent per year. If the required return on Microtech is 15 percent, what is the value of the stock today?Sidman Products's common stock currently sells for $52 a share. The firm is expected to earn $4.68 per share this year and to pay a year-end dividend of $3.10, and it finances only with common equity. a. If investors require a 9% return, what is the expected growth rate? Do not round intermediate calculations. Round your answer to two decimal places. % b. If Sidman reinvests retained earnings in projects whose average return is equal to the stock's expected rate of return, what will be next year's EPS? (Hint: g = (1 - Payout ratio) ROE). Do not round intermediate calculations. Round your answer to the nearest cent. per shareSidman Products's common stock currently sells for $67 a share. The firm is expected to earn $7.37 per share this year and to pay a year-end dividend of $2.60, and it finances only with common equity. a. If investors require an 11% return, what is the expected growth rate? Do not round intermediate calculations. Round your answer to two decimal places. % b. If Sidman reinvests retained earnings in projects whose average return is equal to the stock's expected rate of return, what will be next year's EPS? (Hint: g - (1 - Payout ratio)ROE). Do not round intermediate calculations. Round your answer to the near ent. per share
- Sidman Products's common stock currently sells for $42 a share. The firm is expected to earn $3.36 per share this year and to pay a year-end dividend of $2.40, and it finances only with common equity. a. If investors require an 8% return, what is the expected growth rate? Do not round intermediate calculations. Round your answer to two decimal places. % b. If Sidman reinvests retained earnings in projects whose average return is equal to the stock's expected rate of return, what will be next year's EPS? (Hint: g = (1-Payout ratio)ROE). Do not round intermediate calculations. Round your answer to the nearest cent. per shareMetallica bearings, Inc ., is a young startup company. No dividends will be paid on the stock over the next nine years because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $23.00 per share 10 years from today it will increase the dividends by 5% per year thereafter. If the required return on this stock is 12%, what is the current share price? -Pls write answer in computer. Thanks!!!Microtech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence it does not pay dividends. However, investors expect Microtech to begin paying dividends, beginning with a dividend of $1.00 coming 3 years from today. The dividend should grow rapidly at a rate of 50% per year -during Years 4 and 5; but after Year 5, growth should be a constant 8% per year. If the required return on Microtech is 15% what is the value of the stock today?