罗斯公司理财-Chap006课件

Stock ValuationChapter 6Copyright 2011 by The McGraw-Hill Companies,Inc.All rights reserved.McGraw-Hill/Irwin6-1Comprehend that stock prices depend on future dividends and dividend growthCompute stock prices using the dividend growth modelUnderstand how growth opportunities affect stock valuesAppreciate the PE ratioKnow how stock markets workKey Concepts and Skills6-26.1 The Present Value of Common Stocks6.2 Estimates of Parameters in the Dividend Discount Model6.3 Growth Opportunities6.4 Price-Earnings Ratio6.5 Some Features of Common and Preferred Stock6.6 The Stock MarketsChapter Outline6-3The value of any asset is the present value of its expected future cash flows.Stock ownership produces cash flows from:Dividends Capital GainsValuation of Different Types of StocksZero GrowthConstant GrowthDifferential Growth6.1 The PV of Common Stocks6-4Assume that dividends will remain at the same level foreverCase 1:Zero GrowthSince future cash flows are constant,the value of a zero growth stock is the present value of a perpetuity:6-5Suppose Big Deal Company will pay an annual dividend of$2.00 per common share that will never increase or decrease.The market rate of return is 8.5%.What is the maximum amount you should be willing pay for a common share of Big Deal Corporation?Formula for Zero Growth Model:P=Div/RSolution:P=$2.00/.085 P=$23.53Zero Growth Example6-6Case 2:Constant GrowthSince future cash flows grow at a constant rate forever,the value of a constant growth stock is the present value of a growing perpetuity:Assume that dividends will grow at a constant rate,g,forever,i.e.,.6-7Suppose Big D,Inc.,just paid a dividend of$.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 level,how much should the stock be selling for?P0=.50(1+.02)/(.15-.02)=$3.92Constant Growth Example6-8It is critical to understand that in the constant growth model calculations are based on the next dividendIf a situation only provides information on the last dividend it must be increased by the growth rate to arrive at the next dividendIf a situation provides the value of the next dividend,then the data necessary for the calculation is known and need not be derived.An analyst must discriminate whether they have information about the next or last dividend and proceed with calculation accordinglyA Word About Dividends in the Constant Growth Model6-9Assume that dividends will grow at different rates in the foreseeable future and then will grow at a constant rate thereafter.To value a Differential Growth Stock,we need to:Estimate future dividends in the foreseeable future.Estimate the future stock price when the stock becomes a Constant Growth Stock(case 2).Compute the total present value of the estimated future dividends and future stock price at the appropriate discount rate.Case 3:Differential Growth6-10This graph demonstrates the dividend pro a company with differential growthGraphic:Differential Dividend Growth6-11Case 3:Differential GrowthAssume that dividends will grow at rate g1 for N years and grow at rate g2 thereafter.6-12Case 3:Differential GrowthDividends will grow at rate g1 for N years and grow at rate g2 thereafter 0 1 2NN+16-13Case 3:Differential GrowthWe can value this as the sum of:a T-year annuity growing at rate g1plus the discounted value of a perpetuity growing at rate g2 that starts in year T+16-14Case 3:Differential GrowthConsolidating gives:Or,we can“cash flow”it out.6-15A common stock just paid a dividend of$2.The dividend is expected to grow at 8%for 3 years,then it will grow at 4%in perpetuity.What is the stock worth?The discount rate is 12%.A Differential Growth Example6-16With the Formula6-17With Cash Flows0 1 2340 1 2 3The constant growth phase beginning in year 4 can be valued as a growing perpetuity at time 3.6-18The value of a firm depends upon its growth rate,g,and its discount rate,R.Where does g come from?g=Retention ratio Return on retained earningsExample:Suppose a company has a retention ratio of 70%and earns an ROE of 12%.What is the Growth Rate,g?g=.70 X.12g=.084=8.4%6.2 Estimates of Parameters6-19The discount rate can be broken into two parts.The dividend yield The growth rate(in dividends)AKA:Capital Gains YieldIn practice,there is a great deal of estimation error involved in selecting R.Cases calling for special skepticism:Stocks not paying dividendsStocks with g expected to equal or exceed RWhere Does R Come From?6-20Start with the DGM:Note that D1/P0 is the dividend yield and g is the capital gains yield.Using the DGM to Find RRearrange and solve for R:6-21Imagine that a Solar Corp.s last dividend was$.65 per share.Solars dividends are growing at a rate of 4%and the current price per share is$11.25.What is the market R implicit in Solars price?R=(D1/P0)+gR=(.65 x 1.04)/11.25+.04R=.10 or 10%Example:Using DGM to Find R6-22Dividends may not be a firms only cash payoutRecently many firms have repurchased shares,another form of payoutUsing the Dividend Growth Model,the price of a share will be higher if considering total payout rather than just dividends Total Payout6-23A firm forecasts income of$4.00 per share and will payout 30%as dividends,30%as share repurchase and will retain the rest.Its growth rate is 5%and required return is 10%.What is the price of a share?Dividend Growth Model:P0=(4.00 X.30)/(.1-.05)=$24.00Notice that the price is based on dividend(30%of earnings)growth onlyTotal Payout Model:P0=(4.00 X.60)/(.1-.05)=$48.00Notice that the price is based on total payout(60%of earnings=30%for dividends and 30%for share repurchase)growthExample:Total Payout Valuation6-24Growth opportunities are opportunities to invest in positive NPV projects.The value of a firm can be conceptualized as the sum of the value of a firm that pays out 100%of its earnings as dividends plus the net present value of the growth opportunities.6.3Growth Opportunities6-25Two conditions must exist if a company is to grow:It must not pay out all of its earnings as dividends;and,It must invest in projects with a positive NPVPrerequisites to Growth6-26Why dont firms with no dividends have stock price of$0?Such firms believe their earnings are better used to pursue growth opportunitiesInvestors pay a stock price that conforms to their own calculus of the NPVGO of the no-payout firmThe dividend growth model does not work in valuing this firmThe differential growth model can,but evaluating the timing of changes in growth is trickyThe No-Payout Firm6-27Many analysts frequently relate earnings per share to price.The price-earnings ratio is calculated as the current stock price divided by annual EPS.The Wall Street Journal uses last 4 quarters earnings6.4Price-Earnings Ratio6-28Generally,firms with growth opportunities command greater P/E than those with no such prospectsA firms R also impacts the P/E ratio.The P/E ratio and R are inversely related.A firm with conservative accounting principles will generally have a higher P/E ratio than one with aggressive policiesFactors Impacting the P/E Ratio6-29Voting rights(Cumulative vs.Straight)Proxy votingClasses of stockOther rightsShare proportionally in declared dividendsShare proportionally in remaining assets during liquidationPreemptive right first shot at new stock issue to maintain proportional ownership if desired6.5 Features of Common Stock6-30DividendsStated dividend must be paid before dividends can be paid to common stockholders.Dividends are not a liability of the firm,and preferred dividends can be deferred indefinitely.Most preferred dividends are cumulative any missed preferred dividends have to be paid before common dividends can be paid.Preferred stock generally does not carry voting rights.Features of Preferred Stock6-31Dealers vs.BrokersNew York Stock Exchange(NYSE)Largest stock market in the worldLicense Holders(formerly“Members”)Entitled to buy or sell on the exchange floorCommission brokersSpecialistsFloor brokersFloor tradersOperationsFloor activity6.6 The Stock Markets6-32Not a physical exchange computer-based quotation systemMultiple market makersElectronic Communications NetworksThree levels of informationLevel 1 median quotes,registered representativesLevel 2 view quotes,brokers&dealersLevel 3 view and update quotes,dealers onlyLarge portion of technology stocksNASDAQ6-33Stock Market ReportingGap has been as high as$25.72 in the last year.Gap has been as low as$18.12 in the last year.Gap pays a dividend of 18 cents/share.Given the current price,the dividend yield is.8%.Given the current price,the PE ratio is 18 times earnings.3,996,100 shares traded hands in the last days trading.Gap ended trading at$21.35,which is unchanged from yesterday.6-34What determines the price of a share of stock?What determines g and R in the DGM?Discuss the importance of the PE ratio.What are some of the major characteristics of common and preferred stock?Discuss the nature of the various markets for stocks.Quick Quiz6-35此课件下载可自行编辑修改，供参考！感谢您的支持，我们努力做得更好！