Question
A stock has a steady 5% growth rate in dividends. The required rate of return for stocks of this risk class is 15%. Expected EPS
A stock has a steady 5% growth rate in dividends. The required rate of return for stocks of this risk class is 15%. Expected EPS next year is $3. The dividend payout ratio is expected to remain stable at 30%. What is the value? If the current price is 12, what recommendation (buy/hold/sell) would you issue?
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As per dividend growth model Price of stock Expe...
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Investments Analysis and Management
Authors: Charles P. Jones
12th edition
978-1118475904, 1118475909, 1118363299, 978-1118363294
