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Mature Conglomerate Corporation (MCC) just paid a dividend of $1.35 per share, and that dividend is...

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Finance

Mature Conglomerate Corporation (MCC) just paid a dividend of$1.35 per share, and that dividend is expected to grow at aconstant rate of 6.00% per year in the future. The company's betais 1.15, the required return on the market is 12.50%, and therisk-free rate is 4.00%. What is the intrinsic value for MCC’sstock? Enter your answer rounded to two decimal places. Do notenter $ or comma in the answer box. For example, if your answer is$12,300.456 then enter as 12300.46 in the answer box.

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Solution aCalculation of Cost of equity The Cost of equity of a firm is calculated using the following formula Cost of equity RF RM RF Where RF Risk free rate of return Beta of the firm RM    See Answer
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Mature Conglomerate Corporation (MCC) just paid a dividend of$1.35 per share, and that dividend is expected to grow at aconstant rate of 6.00% per year in the future. The company's betais 1.15, the required return on the market is 12.50%, and therisk-free rate is 4.00%. What is the intrinsic value for MCC’sstock? Enter your answer rounded to two decimal places. Do notenter $ or comma in the answer box. For example, if your answer is$12,300.456 then enter as 12300.46 in the answer box.

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