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Intrinsic value of the stock of company abc

Find the intrinsic value of the stock of company ABC using the following data:

risk free rate = 5%
market risk premium = 8%
Expected market return = risk free rate + market risk premium
beta = 0.9
ROE = 12.5%
dividend payout ratio = 0.22

Dividends for the next 4 years are expected to be .59, .67, .76, .85. Subsequent growth will be at the computed growth rate, g.

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Finance Basics: Intrinsic value of the stock of company abc

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Intrinsic value of the stock of company abc

Reference No:- TGS01450125

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Intrinsic value of the stock of company abc

Reference No:- TGS01450125

Recent Questions Asked Finance Basics

Q : Describe financial regulations in the market economy

Q : Metrics and methodology used in making your determination

Q : Economic variables in identifying long term financial goals

Q : Operating mechanisms for your organization

Q : Intrinsic value of the stock of company abc

Q : Variable costs of producing a component

Q : Key financial information for the two companies

Q : How has pcaob impacted waste management

Q : Markup price and contribution margin

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