Call us 24/7: + 1(925)399 0085

Get your paper done by an expert

No matter what kind of academic paper you need, it is simple and secure to hire an essay writer for a price you can afford at StudyAcer. Save more time for yourself.

WhatsApp + 1(925)399 0085
$ 10
free
  • bibliography
  • title page
  • revisions
per page
19 k happy customers
4.7 out of 5 satisfaction rate
27 writers active

Questar Financial Analysis

Finance 3050 Homework #2 Autumn 2012

Due Thursday 11/29/12 15 points

I. Visit the website http://finance.yahoo.com and gather the following information for

Questar (ticker symbol: STR):

1. The closing price for Questar’s common stock on Tuesday 11/20/12

2. Questar’s annual dividend, projected for next year

3. The current analysts’ average estimate for Questar’s EPS for this year (Dec. ‘12)

4. The current analysts’ average estimate for next year’s EPS (Dec. ‘13)

5. The current analysts’ average estimate of Questar’s 5-yr EPS growth

II. Calculate:

a. Based on the following given information, what rate of return should Questar’s

shareholders require on their investment?

E(rm) = 8.5% Rf = 1.0% Questar’s beta = .44

b. If Questar retains 44% of its earnings, and can earn a return of 3% on reinvested funds, at

what rate can dividends grow indefinitely?

c. Based on your answer to (a) and information obtained in part I, if Questar’s dividend

(Part I, item 2) is expected to grow indefinitely at the rate found in part (b), what is a

share of Questar stock worth today? (Assume that the dividend you found in part I is D0 )

d. By how much is Questar stock overpriced or underpriced when comparing your answer to

part (c) with the current price (part I, item 1)?

e. If Questar’s earnings grow at the estimated growth rate for 5 years (item I, part 5), what

will EPS be at the end of 2017 (begin with the EPS estimate for ‘12 [part 1, item 3])?

f. Using your answer to (f), and assuming that Questar’s P/E ratio is 16.1 at the end of

2017, what should a share of stock sell for at that time?

g. Assume that dividends will not grow for the next 5 years. If you buy a share of Questar

stock at the current price (part I, item 1), receive the current dividend (part I, item 2) for

each of the next 5 years, then sell the stock for the price found in (g), what will be your

dollar-weighted average annual rate of return (Calculate IRR using P0, D1-D5 and P5)?

Our guarantees

Study Acers provides students with tutoring and help them save time, and excel in their courses. Students LOVE us!No matter what kind of essay paper you need, it is simple and secure to hire an essay writer for a price you can afford at StudyAcers. Save more time for yourself. Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Our Homework Writing Disciplines

With a highly diverse team in almost all academic fields including: