Business, 26.02.2020 05:43 mcccreamullinsr

The Generic Genetic (GG) Corporation pays no cash dividends currently and is not expected to for the next 4 years. Its latest EPS was $6.4, all of which was reinvested in the company. The firm’s expected ROE for the next 4 years is 21% per year, during which time it is expected to continue to reinvest all of its earnings. Starting in year 5, the firm will payout all of its earnings as dividend and the firm’s ROE on new investments is expected to fall to 16% per year. GG’s market capitalization rate is 20% per year.

A. What is your estimate of GG’s intrinsic value per share? (Omit the "$" sign in your response. Round your answer to 2 decimal places.)
B. Assuming its current market price is equal to its intrinsic value, what do you expect to happen to its price over the next year? (Omit the "%" sign in your response.)

Answers: 3

Show answers

Another question on Business

Business, 22.06.2019 09:30

Which are the best examples of costs that should be considered when creating a project budget?

Answers: 2

Answer

Business, 22.06.2019 11:20

Aborrower takes out a 30-year adjustable rate mortgage loan for $200,000 with monthly payments. the first two years of the loan have a "teaser" rate of 4%, after that, the rate can reset with a 5% annual payment cap. on the reset date, the composite rate is 6%. what would the year 3 monthly payment be?

Answers: 3

Answer

Business, 22.06.2019 11:30

Mark knopf is an auditor who has been asked to provide an audit and financial statement certification for a company that is going public on the new york stock exchange. knopf wants to know his personal liability if the company provides him with inaccurate or false information. which of the following sources of law will him answer that question? a. the city ordinances where the company headquarters is located. b. the state constitution of the state where the company is incorporated. c. code of federal regulations. d. all of the above

Answers: 1

Answer

Business, 22.06.2019 14:20

Jaynet spends $50,000 per year on painting supplies and storage space. she recently received two job offers from a famous marketing firm – one offer was for $95,000 per year, and the other was for $120,000. however, she turned both jobs down to continue a painting career. if jaynet sells 35 paintings per year at a price of $6,000 each: a. what are her accounting profits? b. what are her economic profits?

Answers: 1

Answer

You know the right answer?

The Generic Genetic (GG) Corporation pays no cash dividends currently and is not expected to for the...

Questions