Can someone explain to me the Difference between Discrete and Blended?
1 answer:
You might be interested in
Answer:
Dividend growth rate anticipated = 14.66%
Explanation:
Using dividend growth model we have
P =
Where P = Current market price = $120
D = Dividend to be paid at year end or next year = $1.37
K = Expected return on equity = 15.8%
g = Expected growth rate
Now putting values we have
$120 =
0.158 - g =
0.158 - 0.0114 = g
0.1466 = g = 14.66%