An investor gathers the data for Disney Inc.. (DIS) presented in the following table:Net IncomeShareholder's EquityEarnings per shareDividend per shareBeta9.45%4.03%O 8.35%$6,4357.89%$45,453Assuming that the market return is 7% and the risk free rate is 3%., Disney's sustainablegrowth rate is closest to?$4.36$3.121.10

The Sustainable Growth Rate (SGR) is a financial measure that measures the rate at which a company…

An investor gathers the data for Disney Inc., (DIS) presented in the following table: Net Income Shareholder's Equity Earnings per share Dividend per share Beta $6,435 $45,453 $4.36 $3.12 1.10 Assuming that the market return is 7% and the risk free rate is 3%, , Disney's sustainable growth rate is closest to?

An investor gathers the data for Disney Inc., (DIS) presented in the following table: Net Income Shareholder's Equity Earnings per share Dividend per share Beta $6,435 $45,453 $4.36 $3.12 1.10 Assuming that the market return is 7% and the risk free rate is 3%, , Disney's sustainable growth rate is closest to?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

A global equity manager is assigned to select stocks from a universe of large stocks throughout the world. The manager will be evaluated by comparing her returns to the return on the MSCI World Market Portfolio, but she is free to hold stocks from various countries in whatever proportions she finds desirable. Results for a given month are contained in the following table: Country Weight InMSCI Index Manager’sWeight Manager’s Returnin Country Return of Stock Indexfor That Country U.K. 0.29 0.24 22% 15% Japan 0.42 0.2 17 17 U.S. 0.23 0.22 10 13 Germany 0.06 0.34 7 15 Required: a. Calculate the total value added of all the manager’s decisions this period. (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.) b. Calculate the value added (or subtracted) by her country allocation decisions. (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount…
A share of stock in Enbridge Inc. pays an annual dividend of $3.34, and the dividend is expected to grow at 2%, on average, in the foreseeable future. The current market price is $44.58/share. Below are the three individuals based on risk perception by each individual (from low to high). Identify who will likely be a buyer or a seller of this stock. (Each individual currently owns 100 shares.) Individual X has a discount rate of 5% Individual Y has a discount rate of 8% Individual Z has a discount rate of 11%
A share of stock of A-Star Inc. is now selling for $23.50. A financial analyst summarizes the uncertainty about the rate of return on the stock by specifying three possible scenarios: Business Condition Scenario, s Probability, p(s) End of Year Price Annual Dividend High growth 1 0.35 $35 $ 4.40 Normal growth 2 0.30 27 4.00 No growth 3 0.35 15 4.00 What are the holding-period returns for a one-year investment in the stock of A-Star Inc. for each of the three scenarios? Calculate the expected HPR and standard deviation of the HPR.
Pls do fast and i will rate instantly for sure Solution must be in typed form Calculate the covariance for the returns of stock 1 and stock 2 given the six years of historical returns presented below: Given that the standard deviation of stock 1 and stock 2 in the table above is 0.2236 and 0.3225, respectively, use your answer in (A) to calculate and interpret the correlation between the 2 assets. Based on the characteristics of NSC and JSE above you are considering forming a portfolio comprising the two stocks such that you invest the following amounts: i. $40000 and $60000 in company NSC and JSE respectively in the first instance, and alternatively ii. $70000 and $30000 in company NSC and JSE respectively. C. What is the expected return and standard deviation of the portfolio in the two instances above? What is the expected return and standard deviation of the portfolio in the two instances above?
D&R A3 6-3 Question 6. VAR Calculation A firm has a portfolio composed of stock A and B with normally distributed returns. Stock A has an annual expected return of 15% and annual volatility of 20%. The firm has a position of $100 million in stock A. Stock B has an annual expected return of 25% and an annual volatility of 30% as well. The firm has a position of $50 million in stock B. The correlation coefficient between the returns of these two stocks is 0.3. If the firm sells $10 million of stock A and buys $10 million of stock B, by how much does the 5% annual VAR change?
D&R A3 6-1 Question 6. VAR Calculation A firm has a portfolio composed of stock A and B with normally distributed returns. Stock A has an annual expected return of 15% and annual volatility of 20%. The firm has a position of $100 million in stock A. Stock B has an annual expected return of 25% and an annual volatility of 30% as well. The firm has a position of $50 million in stock B. The correlation coefficient between the returns of these two stocks is 0.3. What is the 5% daily VAR for the portfolio? Assume 365 days per year.
13.3 Ganado’s Cost of Capital. Maria Gonzalez now estimates Ganado’s risk-free rate to be 3.60%, the company’s credit risk premium is 4.40%, the domestic beta is estimated at 1.05, the international beta is estimated at 0.85, and the company’s capital structure is now 30% debt. All other values remain the same as those presented in this chapter in the section “Sample Calculation: Ganado’s Cost of Capital.” For both the domestic CAPM and ICAPM, calculate the following: Sample Calculation: Ganado’s Cost of Capital Maria Gonzalez, Ganado’s chief financial officer, wants to calculate the company’s weighted average cost of capital in both forms, the traditional CAPM and also ICAPM. Maria assumes the risk-free rate of interest as 4%, using the U.S. government 10-year Treasury bond rate. The expected rate of return of the market portfolio is assumed to be 9%, the expected rate of return on the market portfolio held by a well-diversified domestic investor. Ganado’s estimate of…
An investor has $24,000 to invest in bonds of AAA and B qualities. The AAA bonds yield an average of 6% and the B bonds yield 10%. The investor requires that at least three times as much money should be invested in AAA bonds as in B bonds. How much should be invested in each type of bond to maximize the return? What is the maximum return? Define the variables needed to solve this problem. Organize your given information. (This part NOT graded, but encouraged.) Write the complete linear programming problem, which includes the objective function and all constraints. Graph and make sure all lines are labeled and shaded/solution region is clear and easy to identify. Create a corner point chart. Remember to mark your solution. Answer in a complete sentence or two: How much should be invested in each type of bond to maximize the return? What is the maximum return?
19-An Indian trader approached you with two quotes to know if there is a change in their values after 30 days. Spot rate INR 195 = 1 OMR and 1 INR = 0.00500 OMR after 30 days. Which one of the following will be your answer to the Indian trader? a. None of the options b. INR is appreciated and OMR is appreciated c. INR is depreciated and OMR is depreciated d. OMR is appreciated and INR is depreciated
A stock now trades for 11 TL per share and distributes 0.16 TL in dividends annually. What is the stock worth to an investor if she anticipates selling it for 14 TL in a year and demands a 10% return on equity investments? a. 12,89%b. 12,73%c. 12,87%d. 10%
You have been asked by the chief financial officer of your company to estimate what thecompany’s share price will be at the end of four years from today. Your company has recentlypaid a dividend of $1.00 which is expected to grow at 5% p.a. over the foreseeable future. Ifthe company’s required rate of return on equity is 10% your price estimate at the end of year 4will be closest to: A. $20.00.B. $21.00.C. $24.30.D. $25.50.
6 The economic analysis of a project foresees annual investments equal to R$300,000,000.00, over three years of construction, followed by a very long period, which can be considered infinite, with an annual revenue of R$300,000,000.00 and annual operating costs (including taxes) of BRL 120,000,000.00. Obtain the net present value (NPV) of this project, in the year of the first investment, considering the minimum rate of attractiveness equal to 12% per year.