Calculation of the implied growth duration of company by using various parameters.
1. What is the implied growth duration of Kayleigh Industries given the following:
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S P Industrials
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Kayleigh Industries
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P/E ratios
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16
|
24
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Expected growth
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0.06
|
0.14
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|
Dividend yield
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0.04
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0.02
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2 . Lauren Industries has an 18 percent annual growth rate compared to the market rate of 8 percent. If the market multiple is 18, determine P/E ratios for Lauren Industries, assuming its beta is 1.0 and you feel it can maintain its superior growth rate for
a). the next 10 years.
b). the next 5 years.