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A share may be valued based on the discounted value of the cash flow that the shareholder receives as dividends, in perpetuity. Suppose a share
A share may be valued based on the discounted value of the cash flow that the shareholder receives as dividends, in perpetuity. Suppose a share is expected to pay you a dividend of $5.57 one year from now. Thereafter, the dividend will grow at 2.2% per annum, in perpetuity. If the relevant discount rate is 7.0% p.a. (effective), the shares value today is
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