Dishwasher’s Delights plows back 70.00% of its earnings to take on projects that earn the firm a rate of return of 14.00%. Dishwasher’s stockholders require a return of 13.50% on their common stock. Earnings per share are expected to be $6.00 next year.
a. What is the expected growth rate for Dishwasher’s common stock? (Round your answer to 2 decimal places.)
Growth rate %
b. What is the expected dividend next year? (Round your answer to 2 decimal places.)
Dividend $
c. What is the intrinsic value of Dishwasher’s stock? (Round your answer to 2 decimal places.)
Intrinsic value $
d. If Dishwasher’s management chose to pay out all earnings as dividends, what would be the intrinsic value of its stock? (Round your answer to 2 decimal places.)
Intrinsic value $
e. What is the present value of growth opportunities for Dishwasher's Delights? (Round your answer to 2 decimal places.)
PVGO $