Calculate its dividend payout ratio over the last year:

Calculate the stock's total required return based on the above data:

Calculate the implied perpetual growth rate of dividends per annum (g), assuming that the stock is fairly priced and suits being valued as a perpetuity:

Calculate an estimate of the stock price as a perpetuity assuming that its earnings are all paid as dividends (100% dividend payout ratio) and that the growth rate of earnings (and dividends) is equal to the mid-point of the RBA's inflation target band.

Current share price: 23.46

dividends per share over the last year was 0.41

The firm's earnings per share (EPS) over the last year was: 0.53

Lookup the stock's CAPM beta using Reuters, Yahoo Finance or other source: 1.34

Lookup the median Australian market risk premium (MRP = rm-rf) using Fernandez et al (2023): 0.06

Lookup the current 10 year Australian government bond yield (rf) using Bloomberg or other source: 0.041

Answer rating: 100% (QA)

Current Share Price P 2346 Dividends per Share DPS over the last year 041 Earnings per Share EPS ove... View the full answer