FRL3000: BB Quiz M3B LO1 Valuation
Weisbro and Sons common stock sells for $50 a share and pays an annual dividend that increases by 5.3 percent annually. The market rate of return on this stock is 9.3 percent. What is the amount of the last dividend paid by Weisbro and Sons?
$1.90
Blitz Corp. had total sales of $3,050,000 last year and has 107,000 shares of stock outstanding. The benchmark PS is 1.62 times. What stock price would you consider appropriate?
$3050000/107,000 = 28.50 28.50 x 1.62 = $46.18
The common stock of Eddie's Engines, Inc., sells for $44.48 a share. The stock is expected to pay a dividend of $2.90 per share next year. Eddie's has established a pattern of increasing their dividends by 5.0 percent annually and expects to continue doing so. What is the market rate of return on this stock?
11.52%
World Travel has 7 percent, semiannual, coupon bonds outstanding with a current market price of $1,023.46, a par value of $1,000, and a yield to maturity of 6.72 percent. How many years is it until these bonds mature?
12.53 years
The $1,000 par value bonds of Uptown Tours have a coupon rate of 6.5 and a current price quote of 101.23. What is the current yield?
6.42
Do-Well bonds have a face value of $1,000 and are currently quoted at 86.725. The bonds have coupon rate of 6.5 percent. What is the current yield on these bonds?
8.03
McKerley Corp. has preferred stock outstanding that will pay an annual dividend of $6.25 per share with the first dividend exactly 13 years from today. If the required return is 4.11 percent, what is the current price of the stock?
93.78
Today, June 15, you want to buy a bond with a quoted price of 98.64. The bond pays interest on January 1 and July 1. Which one of the following prices represents your total cost of purchasing this bond today?
Dirty Price
A $1,000 par value corporate bond that pays $60 annually in interest was issued last year. Which one of these would apply to this bond today if the current price of the bond is $996.20?
The current yield exceeds the coupon rate.
