Determine the value of xyz stock

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In 2019, XYZ Berhad reports dividend payout ratio of 35 percent, the cost of equity of 14 percent and current earnings of $18 per share. Earnings and dividend of the company are expected to increase at 6 percent over the next two years. In third, fourth and fifth year, the growth rate is expected to drop by 2 percent yearly. After that, the growth rate is expected to be 8 percent annualy for indefinite period of time. Determine the value of XYZ stock.

Reference no: EM132507582

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