Question
A preferred stock pays a fixed dividend of $2 per share and the discount rate is 8% with a constant-growth rate of 0. Using the
A preferred stock pays a fixed dividend of $2 per share and the discount rate is 8% with a constant-growth rate of 0. Using the constant-growth dividend discount model, what is the current value of the stock? Is it overvalued or undervalued based on its current trading prices of $30 per share?
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International Financial Management
Authors: Jeff Madura
2nd Edition
0314430296, 978-0314430298
