Question
Sun Inc. paid a dividend of $6 this year. The dividends you expect to grow at 4% a year forever. The risk free rate is
Sun Inc. paid a dividend of $6 this year. The dividends you expect to grow at 4% a year forever. The risk free rate is 4% and you require a risk premium of 5%. What is the value of the stock based on the dividend discount model? (10 points)? If the price of the stock in the market is $100 a share, should you buy it and why?
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Business Analysis And Valuation Using Financial Statements Text And Cases
Authors: Krishna G. Palepu, Paul M. Healy, Victor Lewis Bernard, W.Gordon Filby
2nd Edition
0324015658, 9780324015652
