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can some one help please ! 2. You plan to invest in DivMod Inc. and expect the following dividend payments per share over the following
can some one help please !
2. You plan to invest in DivMod Inc. and expect the following dividend payments per share over the following three years as shown in table 2: Year 3 12 Dividend 1.63 2.04 2.55 Table 2: Dividend Payments You expect, that the share price of DivMod Inc. will be EUR 74.70 after three years. Invest- ments with equivalent risk have an expected return of 6.46% (=equity cost of capital). a) What is the current stock price of DivMod Inc. according to the dividend discount model? b) Currently, one share of DivMod. Inc. is traded at a price of EUR 84.19. What does this tell you about the value of DivMod and what should be the strategy of an investor in this caseStep by Step Solution
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