Prof. Navin wishes to invest in the shares of ‘A’ Ltd. whose expected dividend in the first year is 4 in past the company’s dividend per share has grown at an average rate of about 5 per cent annum. Prof. Navin expects that the dividend will grow at the same in future. The required rate of return on the shares is 20% per annum. The market of the share is 16. Advise Prof. Navin whether he should buy the share?
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