Determine the value of Ford Using the Dividend discount model. You can find the current dividend on Yahoo finance. Don't forget to compute g using the retention ratio and return on equity. Also compute the required rate using the CAPM with the Yahoo beta. Use 3.08% for the risk free rate and 3.5% for the RISK Premium (pay attention to what I am giving you here. Using these assumption. What is your required rate? What is your growth assumption? What is the value of Ford? Is this reasonable? If not what does the market assume will be the growth rate of dividends going forward if Ford is priced at $11?
Beta 0.03
Dividends & Splits
Forward Annual Dividend Rate4 N/A
Forward Annual Dividend Yield4 N/A
Trailing Annual Dividend Rate3 N/A
Trailing Annual Dividend Yield3 N/A
5 Year Average Dividend Yield4 N/A
Payout Ratio4 0.00%
Dividend Date3 N/A
Ex-Dividend Date4 N/A
Last Split Factor (new per old)2 1/2
Last Split Date3 Dec 24, 1997