An analyst obtained the following information regarding Global Transpo

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School
Western Governors University **We aren't endorsed by this school
Course
FINANCE MISC
Subject
Finance
Date
Nov 4, 2023
Pages
1
Uploaded by CorporalIbis3702 on coursehero.com
An analyst obtained the following information regarding Global Transporters Ltd.: Current share price = 28 Recent dividend per share = 1.95 Earnings per share = 4.25 Return on equity = 25% Required rate of return = 20% A. Use the Gordon growth model to estimate Global s intrinsic value. B. How much does the dividend growth assumption add to the intrinsic value estimate? Page 3 of 9 C. Based on the intrinsic value estimate, is the company s share undervalued, fairly valued, or overvalued? D. Calculate the intrinsic value if the growth rate estimate is lowered to 12%. E. Calculate the intrinsic value if the growth rate estimate is lowered to 12% and the required rate of return estimate
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