This Problem Counts 3 Points Assume the following data for…
This Problem Counts 3 Points Assume the following data for GeoSpace Dwellings, a publicly held firm that constructs habitats for dessert living. Of GeoSpace Dwelling’s stock price of $198.46/share how much would be attributed to the firm’s growth opportunity? NOTE: Some of the data in the table below is NOT relevant to this problem. Stock price $198.46 Dividend per share $1.25 Earnings per share $4.78 Book value per share $43.02 Discount rate 18% Effective Tax Rate 21% EBITDA $725.45 million
Read DetailsConsider the following financial data for NCR. US 10-Year T-…
Consider the following financial data for NCR. US 10-Year T-Bond Yield = 1.61% Market Risk Premium = 6.25% Tax Rate = 21% Also the following data for NCR: Stock Price = $47.25 Market Cap = $6.185 Billion Beta = 1.82 Moodys = A1 (122 basis points) Total Debt = $3.91 Billion Number of Shares Outstanding = 130.9 Million EPS = -$.79 Total Debt/Equity (Book Value) =284.78 Book Value/share = $8.39 Revenues = $6.25 Billion Price/Earning Multiple = 9.72 Dividend $0.00 Calculate the Cost of Capital for NCR. Choose the best answer from the list below. This Problem Counts 5 Points
Read DetailsGreater Brands is considering the purchase of a regional fas…
Greater Brands is considering the purchase of a regional fast casual chain Plaza Taco. Plaza Taco would be added to a growing list of Greater Brands franchisors targeted toward niche ethnic food segments in the US and in northern Mexico, market areas. The current cash flow from assets for Plaza Taco is $7.1 million and are expected to grow at a rate 10% per year for the next five (5) years before leveling off to a 4% growth rate for the indefinite future. The cost of capital for Greater Brands and Plaza Taco are 11 percent and 9 percent, respectively. Plaza currently has 2.5 million shares of stock outstanding and $22 million in net debt. What is the maximum price per share Greater Brands should pay for Plaza Taco? Problem Counts 6 Points
Read DetailsConsider both Statements. Statement 1. Discounting an inves…
Consider both Statements. Statement 1. Discounting an investment’s Annual Economic Value Added cash flow stream is equivalent to calculating the investment’s NPV. Statement 2. There is a positive correlation between Economic profits (EVA) and stock prices.
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