What is the current value per share

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Q1. Teguh Industries can issue perpetual preferred stock at a price of RM34.50 a share. The stock would pay a constant annual dividend of RM3.50 a share. What is the company's cost of preferred stock, rp?

Q2. Harmoni Bhd. Will pay a RM2.60 per share dividend next year. The company pledges to increase its dividend by 3.4 percent per year indefinitely. If you require a 7.4 percent return on your investment, how much should you pay for the company's stock today? (Do not include the dollar sign (RM). Round your answer to 2 decimal places.)

Q3. Rumah Bhd's most recent paid dividend was RM2.50 a share. Yesterday, the firm announced the dividend expected to grow at 3 percent per year for the next 5 years, after which the dividend growth rate will increase to 6 percent per year indefinitely. Assume 10 percent required rate of return. What is the current value per share? If the share is currently selling at RM50, is the share overpriced/ underpriced? Would it be considered a good buy?

Reference no: EM133161536

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