Karena Berhad paid an annual dividend of RM0.90 per share this year. The company expects...
50.1K
Verified Solution
Link Copied!
Question
Finance
Karena Berhad paid an annual dividend of RM0.90 per share this year. The company expects that the dividend will grow an annual rate of 12 percent for the next five years and then drop to a gradual growth rate of 6 percent indefinitely. The required rate of return is 10 percent and the share is currently trading at RM45.
i) Calculate the intrinsic (fair) value of the share today.
ii) Justify whether you would buy the share.
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Best
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.