The following regression was run using all nyse firms in, Ask an Expert

Accounting

The following regression was run using all NYSE firms in 1995 YIELD = 0.0478 - 0.0157 BETA + 0.0000008 MKTCAP + 0.006797 DBTRATIO + 0.0002 ROE - 0.09 NCEX/TA R2 = 12.88% where BETA = beta of the stock, MKTCAP = market value of equity + book value of debt, DBTRATIO = book value of debt/MKTCAP, ROE = return on equity in 1994, and NCEX/TA = (capital expenditures - depreciation)/total assets. The corresponding values for Black and Decker, in 1995, were as follows:

Beta = 1.30

MKTCAP = $5,500 million DBTRATIO = 35%

ROE = 14.5%

NCEX/TA = 4.00%

Black and Decker had a dividend yield of 1.3 percent and a dividend payout ratio of 24 percent in 1995.

a. Estimate the dividend yield for Black and Decker, based on the regression.

b. Why might your answer be different using this approach than the answer to the prior question, where you used only the comparable firms?

View complete question

Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91631232

Have any Question?Write your Review or question?

Related Questions in Accounting Basics

Question - various financial ratios could be used to

Question - Various financial ratios could be used to analyse a company's financial performance and position. a) What ratios would you calculate to evaluate a company's profitability? Provide two examples of the ratios an ...

Question revenue from contracts with customers

Question: Revenue From Contracts With Customers Examples Part I: For each of the scenarios determine if a contract exists by applying the 5 requirements for a contract to exist under ASC 606. 1. For each of the following ...

Question - on october 1 2018 daw inc signed a long-term

Question - On October 1, 2018, DAW Inc. signed a long-term, non-cancellable purchase commitment with a major supplier to purchase raw materials needed for production of the company's product during 2019 for $1,000,000. O ...

Question - exter co receives terms of 210 n30 on all

Question - Exter Co. receives terms of 2/10, n/30 on all invoices from Garn Industries. On January 15, 2008, Exter purchased items from Garn for $4,200, excluding taxes and shipping costs. What amount would Exter use as ...

Question texas co established the following overhead cost

Question: Texas Co. established the following overhead cost pools and cost drivers: Budgeted Estimated Overhead Cost Pool Overhead Cost Driver Cost Driver Level Quality controls $780,000 # of inspections 26,000 inspectio ...

Question - shelby has net investment income of 16790 and

Question - Shelby has net investment income of $16,790 and wage income of $72,000. She paid investment interest expense of $17,300. What is Shelby's deduction for investment interest expense?

Question introduction you are a consultant hired by a

Question: Introduction: You are a consultant hired by a consumer products research company to analyze the packaging of various consumer products. Your first assignment is to go into a retail store and pick three products ...

Question - the following list of accounts appear in

Question - The following list of accounts appear in alphabetical order and were taken from ABC Corporation's ledger as of December 31, 2018. The Accounts Payable records were missing. Accounts Payable $? Inventory $7,000 ...

Question - transfer pricing jayeo ltd manufactures string

Question - Transfer Pricing JayEo Ltd. manufactures string {only} for tennis racquets in their String Division. The Frame Division builds the alloy frames {only}, and then Assembly threads the string into the frames. The ...

Question - hunter co purchased a delivery truck the total

Question - Hunter Co. purchased a delivery truck. The total cash payment was $30,020, including: Negotiated purchase price $24,000 Installation of special shelving 1,100 Painting and lettering 900 Motor vehicle license 1 ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Accounting Basics Expert