Given the information below for Seger Corporation, compute the expected share price at the end of 2022 using price ratio analysis. Assume that the historical (arithmetic) average growth rates will remain the same for 2022. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Year Price EPS CFPS 2016 $ 84.90 2.70 SPS 7.92 66.50 2017 $ 90.80 3.41 8.76 2018 $ 89.50 4.21 2019 2020 2021 $ 87.00 $ 108.50 $ 123.90 4.91 7.65 8.65 9.10 10.77 12.19 13.36 71.50 70.90 74.40 85.60 93.60 Using PE ratio Using P/CF ratio Using P/S ratio Share Price

Given the information below for Seger Corporation, compute the expected share price at the end of 2022 using price ratio analysis. Assume that the historical (arithmetic) average growth rates will remain the same for 2022. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Year Price EPS CFPS 2016 $ 84.90 2.70 SPS 7.92 66.50 2017 $ 90.80 3.41 8.76 2018 $ 89.50 4.21 2019 2020 2021 $ 87.00 $ 108.50 $ 123.90 4.91 7.65 8.65 9.10 10.77 12.19 13.36 71.50 70.90 74.40 85.60 93.60 Using PE ratio Using P/CF ratio Using P/S ratio Share Price

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 2MAD

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CALCULATING THE WACC Here is the condensed 2019 balance sheet for Skye Computer Company (in thousands of dollars): Skyes earnings per share last year were 3.20. The common stock sells for 55.00. last years dividend (D0) was 2.10, and a flotation cost of 10% would be required to sell new common stock. Security analysts are projecting that the common dividend will grow at an annual rate of 9%. Skyes preferred stock pays a dividend of 3.30 per share, and its preferred stock sells for 30.00 per share. The firms before-lax cost of debt is 10%, and its marginal tax rate is 25%. The firms currently outstanding 10% annual coupon rate, long-term debt sells at par value. The market risk premium is 5%, the risk-free rate is 6%, and Skyes beta is 1.516. The firms total debt, which is the sum of the companys short-term debt and long-term debt, equals 1.2 million. a. Calculate the cost of each capital component, that is, the after-tax cost of debt, the cost of preferred stock, the cost of equity from retained earnings, and the cost of newly issued common stock. Use the DCF method to find the cost of common equity. b. Now calculate the cost of common equity from retained earnings, using the CAPM method. c. What is the cost of new common stock based on the CAPM? (Hint: Find the difference between r1 and rs as determined by the DCF method, and add that differential to the CAPM value for rs.) d. If Skye continues to use the same market-value capital structure, what is the firms WACC assuming that (1) it uses only retained earnings for equity and (2) if it expands so rapidly that it must issue new common stock?
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Given the information below for Seger Corporation, compute the expected share price at the end of 2020 using price ratio analysis. Assume that the historical (arithmetic) average growth rates will remain the same for 2020. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Year 2014 2015 2016 2017 2018 2019 Price $ 52.10 $ 58.00 $ 56.70 $ 54.20 $ 75.70 $ 91.10 EPS 3.10 3.81 4.61 5.31 7.10 8.10 CFPS 7.37 8.32 8.77 10.22 11.86 13.14 SPS 23.70 28.70 28.10 31.60 42.80 50.80
Given the information below for HooYah! Corporation, compute the expected share price at the end of 2020 using price ratio analysis. Assume that the historical (arithmetic) average growth rates will remain the same for 2020. Year 2014 2015 2016 2017 2018 2019 Price $ 15.00 $ 51.50 $ 123.00 $ 200.00 $ 90.00 $ 20.50 EPS −7.00 −6.29 −2.10 −.45 .03 .06 CFPS −16.00 −13.50 −3.10 −.15 .38 .08 SPS 12.00 20.50 21.60 25.10 28.60 28.95 using PE ratio Using P / CF ratio Using the P /S ratio
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Dear Bartleby, I need help calculating the dividend yield e. If Wiper's stock had a price/earnings ratio of 14 at the end of 2020, what was the market price of the stock? (Round intermediate calculations and final answer to 2 decimal places.)f. Calculate the cash dividend per share for 2020 and the dividend yield based on the market price calculated in part e. (Round intermediate calculations and final answers to 2 decimal places. Presented here are summarized data from the balance sheets and income statements of Wiper Inc.: WIPER INC. Condensed Balance Sheets December 31, 2020, 2019, 2018 (in millions) 2020 2019 2018 Current assets $ 650 $ 900 $ 700 Other assets 2,750 2,050 1,750 Total assets $ 3,400 $ 2,950 $ 2,450 Current liabilities $ 500 $ 800 $ 700 Long-term liabilities 1,500 1,000 800 Stockholders' equity 1,400 1,150 950 Total liabilities and stockholders' equity $ 3,400 $ 2,950 $ 2,450…
A company expects EPS to be $2.52 next year. The industry average P/E ratio is 23.99 and Enterprise multiple is 7.57. The EBITDA for the company is $22.97 million. What is an estimate of the stock price using the method of comparables for P/E multiples? Round your answer to two (2) decimal places.
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