If the Premier Corporation has an ROE of 8 percent and a payout ratio of 16 percent, what is its sustainable growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
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Problem 3-6 Sustainable Growth
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- Problem 3-10 Sustainable Growth Rate The Iron River Company has an ROE of 14.6 percent and a payout ratio of 30 percent. What is the company’s sustainable growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)Problem 3-26 Constraints on Growth Tinsley, Incorporated, wishes to maintain a growth rate of 12 percent per year and a debt-equity ratio of .5. The profit margin is 5.4 percent, and the ratio of total assets to sales is constant at 1.63. What dividend payout ratio is necessary to achieve this growth rate under these constraints? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) What is the maximum growth rate possible? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Is a growth rate of 12 percent possible?Problem 4-12 Internal Growth [LO3] Fairlane Company. has an ROA of 12 percent and a payout ratio of 25 percent. What is its internal growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Internal Growth Rate.
- A4) Finance You estimate that the net income for a company next year is a uniform distribution with a minimum of $106 million and a maximum of $127 million. What is the probability that the company's net income is less than or equal to $117 million? Enter answer in percents, to two decimal places.H3. A firm wishes to maintain an sustainable growth rate of 9 percent and a dividend payout ratio of 64 percent. The ratio of total assets to sales is constant at 0.9, and the profit margin is 10.1 percent. If the firm also wishes to maintain a constant debt-equity ratio, what must it be? Please show proper step by step calculationCh 9. Use the following information for Question 22 and 23. The newspaper reported last week that SunRise Enterprises earned $30.87 million this year. The report also stated that the firm’s return on equity is 13 percent. The firm retains 85 percent of its earnings. What is the firm's earnings growth rate? Format as a percentage as "XX.XX"
- 1. Using PROBLEM 2, what is the projected growth rate for the 10-year period? (Round off to 2 decimal places. Example 12.534% must be written as 12.53) 2. Using PROBLEM 2, If your required return on investment is 12%, how much will be the INTRINSIC Value of U-GANDA Corporation? 3. Using PROBLEM 2, If your required return on investment is 12%, would you purchase the shares of U-GANDA Corporation? Substantiate your answer.rofit margin = 9.2 % Capital intensity ratio = .53 Debt-equity ratio = .68 Net income = $ 103,000 Dividends = $ 52,000 Based on the above information, calculate the sustainable growth rate for Northern Lights Co. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)Problem 9.5 Fresno Corp. is a fast-growing company that expects to grow at a rate of 27 percent over the next two years and then to slow to a growth rate of 13 percent for the following three years. If the last dividend paid by the company was $2.15. What is the dividend for 1st year? (Round answer to 3 decimal places, e.g. 15.250.) D1 $ What is the dividend for 2nd year? (Round answer to 3 decimal places, e.g. 15.250.) D2 $ What is the dividend for 3rd year? (Round answer to 3 decimal places, e.g. 15.250.) D3 $ What is the dividend for 4th year? (Round answer to 3 decimal places, e.g. 15.250.) D4 $ What is the dividend for 5th year? (Round answer to 3 decimal places, e.g. 15.250.) D5 $ Compute the present value…
- Ch 9. Use the following information for Question 22 and 23. The newspaper reported last week that SunRise Enterprises earned $34.19 million this year. The report also stated that the firm’s return on equity is 13 percent. The firm retains 85 percent of its earnings. What will next year's earnings be? Round to the nearest dollar and format as "XX,XXX,XXX"INV3 P6a You are interested in determining the intrinsic value of Hoffman Inc. Your analysis shows that the firm’s growth rate will drop from its current pace by 20% each of the next two years, and then you estimate that dividends will continue to grow at the year 2 rate, with the same dividend policy in place, indefinitely. Lastly, your estimate of the required return on the firm’s equity is 12%. Hoffman’s recently published annual report shows the following financial relationships: Assets = 1.4 x Equity Current Assets = 1.7 x Current Liabilities Sales = 1.5 x Assets Net Income = 8% x Sales Dividends = 30% x Net Income Earnings per share (Basic) = $0.80 per share Determine the growth rate of the company for the prior and for each of the next two years.INV3 P6b You are interested in determining the intrinsic value of Hoffman Inc. Your analysis shows that the firm’s growth rate will drop from its current pace by 20% each of the next two years, and then you estimate that dividends will continue to grow at the year 2 rate, with the same dividend policy in place, indefinitely. Lastly, your estimate of the required return on the firm’s equity is 12%. Hoffman’s recently published annual report shows the following financial relationships: Assets = 1.4 x Equity Current Assets = 1.7 x Current Liabilities Sales = 1.5 x Assets Net Income = 8% x Sales Dividends = 30% x Net Income Earnings per share (Basic) = $0.80 per share Use the multi-period DDM to estimate the intrinsic value of the company’s stock now, at the beginning of year 1.
