Zoom Enterprises expects that one year from now it will pay a total dividend of $5.2 million and repurchase $5.2 million worth of shares. It plans to spend $10.4 million on dividends and repurchases every year after that forever, although it may not always be an even split between dividends and repurchases. If Zoom's equity cost of capital is 13.1% and it has 5.1 million shares outstanding, what is its share price today?

The share price today is $15.57

Explanation:

Value of the firm  = Cash Flow / Cost of Equity

Value of the firm=  $10,400,000 /  13.1%

Value of the firm= $79,389,312.98

If Zoom's equity cost of capital is 13.1% and it has 5.1 million shares outstanding, what is its share price today

Share price today = $79,389,312.98 / 5,100,000 Shares

Share price today = $15.5665

Share price today = $15.57

The share price today is $15.57

i would say a penny hope it you

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