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The ABC Company is about to pay a dividend of $3 per share i.e it is paying it later today). The dividend is expected to
The ABC Company is about to pay a dividend of $3 per share i.e it is paying it later today). The dividend is expected to grow at a rate of 8% next year and 5% the year after, and then to stabilize at growth of 4% per annum into perpetuity thereafter.
The company's beta is 1.5, the risk-free rate is 2% and the market risk premium is 6%. Based on this information, what is your estimate of the intrinsic value of one share in ABC Company?
The company's beta is 1.5, the risk-free rate is 2% and the market risk premium is 6%. Based on this information, what is your estimate of the intrinsic value of one share in ABC Company?
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Step 1 Calculate the expected dividends for the next three years Dividend Dividend this year ...
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Fundamentals of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford, David A. Stangeland, Andras Marosi
1st canadian edition
978-0133400694
