True or false:
-When using the Free Cash Flow method, the value of the entire firm is calculated. The amount of any LT debt must be subtracted from that value prior to calculating the stock's intrinsic value.
-Free Cash Flow is calculated in the same manner as is Cash Flow From Assets - it is the same value.
-The formula for the stock price using the dividend model with the non-growth assumption is = [ most recent dividend / Required Rate of Return]
-The formula for the stock price using the dividend model, constant growth assumption is = [most recent dividend / (Required Rate of Return - dividend growth rate)]
-The Required Rate of Return for a firm's stock is calculated with the CAPM. That Rate is also used as the Cost of Equity when calculating that firm's WACC.
-The formula for the constant growth dividend model implies that the return on a stock is composed of its dividend yield and dividend growth rate.
True or false:
-When using the Free Cash Flow method, the value of the entire firm is calculated. The amount of any LT debt must be subtracted from that value prior to calculating the stock's intrinsic value.
-Free Cash Flow is calculated in the same manner as is Cash Flow From Assets - it is the same value.
-The formula for the stock price using the dividend model with the non-growth assumption is = [ most recent dividend / Required Rate of Return]
-The formula for the stock price using the dividend model, constant growth assumption is = [most recent dividend / (Required Rate of Return - dividend growth rate)]
-The Required Rate of Return for a firm's stock is calculated with the CAPM. That Rate is also used as the Cost of Equity when calculating that firm's WACC.
-The formula for the constant growth dividend model implies that the return on a stock is composed of its dividend yield and dividend growth rate.
