1. Marriott
Common Stock Marriott's common stock price grew constantly in the ten-year period 1978-1987, from $2.43 per share at the end of 1978 to $30 at the end of 1987 (see exhibit 2) at an average rate of 35% per year. Using the Myron Gordon's Growth Model for the ten-year period 1978-1987, Marriott's expected return of common stock ranges 22% - 23% annual, while the cost of common stock for the company ranges 12% - 18% (see exhibit 3 for calculations). ... It is observed that the company's capital structure is composed by a 60% long-term debt, 40% stock in 1987. ... As discuss...
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