公司理财规划.ppt

Chapter 7
Equity Markets and Stock Valuation
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Key Concepts and Skills
Understand how stock prices depend on fuI = 20; CPT NPV =
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Developing The Model
You could continue to push back when you would sell the stock
You would find that the price of the stock is really just the present value of all expected future dividends
So, how can we estimate all future dividend payments?
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Estimating Dividends: Special Cases
Constant dividend
The firm will pay a constant dividend forever
This is like preferred stock
The price is computed using the perpetuity formula
Constant dividend growth
The firm will increase the dividend by a constant percent every period
Supernormal growth
Dividend growth is not consistent initially, but settles down to constant growth eventually
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Zero Growth
If dividends are expected at regular intervals forever, then this is like preferred stock and is valued as a perpetuity
P0 = D / R
Suppose stock is expected to pay a $ dividend every quarter and the required return is 10% with quarterly compounding. What is the price?
P0 = .50 / (.1 / 4) = .50 / .025 = $20
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Dividend Growth Model
Dividends are expected to grow at a constant percent per period.
P0 = D1 /(1+R) + D2 /(1+R)2 + D3 /(1+R)3 + …
P0 = D0(1+g)/(1+R) + D0(1+g)2/(1+R)2 + D0(1+g)3/(1+R)3 + …
With a little algebra, this reduces to:
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DGM – Example 1
Suppose Big D, Inc. just paid a dividend of $.50. It is expected to increase its dividend by 2% per year. If the market requires a return of 15% on assets of this risk, how much should the stock be selling for?
P0 = .50(1+.02) / (.15 - .02) = $
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DGM – Example 2
Suppose TB Pirates, Inc. is expected to pay a $2 dividend in one year. If the dividend is expected to grow at 5% per year and the required return is 20%, what is the price?
P0 = 2 / (.2 - .05) = $
Why isn’t the $2 in the numerator multiplied by () in this example?
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Stock Price Sensitivity to Dividend Growth, g
D1 = $2