Assume Cameron Ltd is a listed company on ASX (Australian Stock Exchange), the following information has been collected by you as a financial analyst.

Risk-free rate 1.2%

Market Risk Premium 6%

Beta of Share 1.3

Last Dividend paid $3.20 (assume dividend only paid annually by Cameron)

Forecast dividend growth rate 4.1% Current Price of ordinary share $60.90

Required:

1. Value an ordinary share in Dominos using the Gordon Constant Growth Dividend Model.

2. Would you recommend a purchase of a batch of shares in this company at current price level? Please justify your answers critically