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Business, 18.11.2019 22:31 KIAZTUNEZ

Substantially less.) payout and valuation surf & turf hotels is a mature business, although it pays no cash dividends. next year’s earnings are forecasted at $56 million. there are 10 million outstand- ing shares. the company has traditionally paid out 50% of earnings by repurchases and rein- vested the remaining earnings. with reinvestment, the company has generated steady growth averaging 5% per year. assume the cost of equity is 12%. calculate surf & turf ’s current stock price, using the constant-growth dcf model. (hint: take the easy route and value overall market capitalization.) (do not round intermediate calculations. round your answer to the nearest whole number.)

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