Business, 25.04.2020 02:48 karlacr5117
DFB, Inc. expects earnings next year of $ 5.83 per share, and it plans to pay a $ 4.02 dividend to shareholders (assume that is one year from now). DFB will retain $ 1.81 per share of its earnings to reinvest in new projects that have an expected return of 15.9 % per year. Suppose DFB will maintain the same dividend payout rate, retention rate, and return on new investments in the future and will not change its number of outstanding shares. Assume next dividend is due in one year. a. What growth rate of earnings would you forecast for DFB? b. If DFB's equity cost of capital is 12.7 %, what price would you estimate for DFB stock? c. Suppose instead that DFB paid a dividend of $ 5.02 per share at the end of this year and retained only $ 0.81 per share in earnings. That is, it chose to pay a higher dividend instead of reinvesting in as many new projects. If DFB maintains this higher payout rate in the future, what stock price would you estimate for the firm now? Should DFB raise its dividend?
Answers: 3
Business, 21.06.2019 20:20
Jimmy owns an ice cream parlor. he designs a schedule for the different tasks the employees have to perform in order to prevent monotony at work. according to the schedule, if an employee makes waffle cones on a day, he serves ice creams the next day and clears the tables on the day after that. jimmy is using the approach at his ice cream parlor.
Answers: 2
Business, 22.06.2019 10:30
How are interest rates calculated by financial institutions? financial institutions generally calculate interest as (1) interest or (.
Answers: 1
Business, 22.06.2019 17:00
Serious question, which is preferred in a business? pp or poopoo?
Answers: 1
DFB, Inc. expects earnings next year of $ 5.83 per share, and it plans to pay a $ 4.02 dividend to s...
Mathematics, 06.11.2020 21:30
Arts, 06.11.2020 21:30
English, 06.11.2020 21:30
English, 06.11.2020 21:30
History, 06.11.2020 21:30
Mathematics, 06.11.2020 21:30
Physics, 06.11.2020 21:30
Mathematics, 06.11.2020 21:30
Biology, 06.11.2020 21:30
Health, 06.11.2020 21:30