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The Best Deal Company's dividend is expected to grow at a rate of 6% per year indefinitely. You think the appropriate market capitalization rate is
The Best Deal Company's dividend is expected to grow at a rate of 6% per year indefinitely. You think the appropriate market capitalization rate is 16% per year. a. If this year's dividend (just paid) is $6 per share, what is your estimate of the intrinsic value per share? b. If expected EPS is $10, what is the implied value of the ROE on future investment opportunities? c. How much is the market paying per share for growth opportunities
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