Question
(a) The most recent dividend paid on shares in WMB Plc was shs10 per share. WMB dividends are expected to grow at 5% p.a. The
(a) The most recent dividend paid on shares in WMB Plc was shs10 per share. WMB dividends are expected to grow at 5% p.a. The required rate of return is 8% p.a. What is the intrinsic value of the shares?
(b) What would be the fair price of the shares if dividend growth were expected to fall to 4% p.a. after three years?
(c) If the rate of dividend growth were to remain at 5% p.a.
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Financial Markets And Institutions
Authors: Anthony Saunders, Marcia Cornett
7th Edition
1259919714, 978-1259919718
