Philip plc is reserving its cashflows by fixing its dividends payments. the company is expected to pay an annual dividend of 4£ over the next 10 years. thereafter, dividends are expected to grow by 5% annually.

Estimate the fair market stock price of the firm using the dividend valuation model. Assume the required rate of return for stockholders is 15%.

Answer rating: 100% (QA)

The dividend valuation model also known as the Gordon Growth Model can be us... View the full answer