Question
Venus Corporation just paid P5 dividends on its ordinary shares and such dividends are projected to grow 5% annually for the coming years. The ordinary
Venus Corporation just paid P5 dividends on its ordinary shares and such dividends are projected to grow 5% annually for the coming years. The ordinary shares are currently selling at P40 in the market. Its 10% preference shares with P100 par value are currently selling in the market at P105. VENUS Corporation regularly pays dividends at the end of each year. Ms. Deli Kado is deciding whether to buy or not some preference shares of the corporation which she intends to sell after 5 years at a projected price of P125. Ms. Kado asked your advice regarding the matter. If she requires a 12% return on investment, should she acquire the preference shares or not? Explain.
Can I get an accurate answer to these problems? With complete solution. Thank you
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