Question
Think about the electric utility industry. In 2009, the dividend paid by the utility company, DTE Energy Co. (DTE), was $2.12. Using D 0 =$2.12,
Think about the electric utility industry.
In 2009, the dividend paid by the utility company, DTE Energy Co. (DTE), was $2.12.
Using D0 =$2.12, k = 5.75%, and g = 2%, calculate an estimated value for DTE.
Note: the actual mid-2009 stock price of DTE was $40.29.
What are the possible explanations for the difference?
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Finance For Executives Managing For Value Creation
Authors: Gabriel Hawawini, Claude Viallet
3rd Edition
0324274319, 9780324274318
