A company has been growing at a fast rate of 35% per year recently and this growth rate is expected to last for another two years. Thereafter, the growth rate is expected to decline to a sustainable...

A company has been growing at a fast rate of 35% per year recently and this growth rate is expected to last for another two years. Thereafter, the growth rate is expected to decline to a sustainable rate of 5% 1. If the most recent dividend paid is RM1.20 and required rate of return is 12%, how much is the stock worth today? 2. Based on the calculation in (a), would you buy the share if the stock is selling at RM25 today? Is the share overvalued or undervalued? Please help me ASAP. Thanks!

Jun 08, 2022
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