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Dividend discount model in calculating the wacc

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The question asks to use the dividend discount model in calculating the WACC. To determine the DDM Dividend per share (2.50)/Discount Rate (2%-4%=1.92%)-Dividend Growth Rate (4%)= 1.84 so 2.50/1.84%=135.87. Is 135.87 greater than the current price 50.00 then the stock is undervalued. Correct?

Reference no: EM131911147

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