Find the price at which analogs stock should sell calculate


Analog Corp has an ROE of 12% and a beta of 1.5. It plans to maintain indefinitely its traditional plowback ratio of 0.6. This year's earnings were $2.50 per share. The annual dividend was just paid. The consensus estimate of the coming year's market return is 10%, and the T-Bills currently offer a 4% yield.

  • Find the price at which Analog's stock should sell.
  • Calculate the P/E ratio.
  • Calculate the present value of growth opportunities.
  • Suppose your information suggest that the company will be reducing its plowback to 0.4. Find the intrinsic value of the stock if the cutback takes effect immediately.

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Operation Management: Find the price at which analogs stock should sell calculate
Reference No:- TGS01359597

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