Question
The growth in dividends of Tan Berhad is expected to be 15% per year for the next threeyears, followed by a growth rate of 8%
The growth in dividends of Tan Berhad is expected to be 15% per year for the next threeyears, followed by a growth rate of 8% per year for two years. After this five-year period, the growth in dividends is expected to be 3% per year, indefinitely. The required rate ofreturn on Tan Berhad is 13%. Last year's dividends per share were RM1.85. What shouldthe stock sell for today?
Step by Step Solution
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Step: 1
To calculate the stock price of Tan Berhad today we can use the dividend discount model DDM which ta...
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Fundamentals Of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
5th Edition
0135811600, 978-0135811603
