Input | |||||
Dividend growth rate (Year 1 to 3) | 30.0% | ||||
Dividend growth rate (Year 4 onwards) | 6.0% | ||||
Required return | 11.0% | ||||
Recent Dividend ($) | 5.50 | ||||
Calculation & Output | |||||
Year 0 | Year 1 | Year 2 | Year 3 | Year 4 | |
Dividends | |||||
Question 11 | |||||
Terminal Value | |||||
Question 12 | |||||
Current Share Price |
Input | |||||
Dividend growth rate (Year 1 to 3) | 30.00% | ||||
Dividend growth rate (Year 4 onwards) | 6.00% | ||||
Required return | 11.00% | ||||
Recent Dividend ($) | 5.50 | ||||
Calculation & Output | |||||
Year 0 | Year 1 | Year 2 | Year 3 | Year 4 | |
Dividends | 5.50 | 7.15 | 9.30 | 12.08 | 12.81 |
Terminal Value = 12.81/(0.11-0.06) = | 256.20 | ||||
PVIF at 11% | 1 | 0.90090 | 0.81162 | 0.73119 | |
PV at 11% | 6.44 | 7.54 | 8.84 | ||
Sum of PV of dividends, years 1 to3 | 22.82 | ||||
PV of terminal value = 256.20*0.73119 = | 187.33 | ||||
Current Share Price | 210.15 |
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