Assume that share price of Oman Petro products is rials at the end of 2019. We atso that price-toearnings ratio of similar companies is 20. The company has a 50% Dividend payout policy (50% of earnings is paid out dividends)Earnings per share forecasted to be 0.100 Rials for end of year 2020 and is forecasted to grow by % year after . Assume required return is 10 per cent. 1. Calculate the value per share using the Dividend Discount Model ? 2.Do you recommend a “Buy “ or “Sell “using the DDM method?

Assume that share price of Oman Petro products is rials at the end of 2019. We atso that price-toearnings ratio of similar companies is 20. The company has a 50% Dividend payout policy (50% of earnings is paid out dividends)Earnings per share forecasted to be 0.100 Rials for end of year 2020 and is forecasted to grow by % year after . Assume required return is 10 per cent. 1. Calculate the value per share using the Dividend Discount Model ? 2.Do you recommend a “Buy “ or “Sell “using the DDM method?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter9: Corporate Valuation And Financial Planning

Section: Chapter Questions

Problem 2MC

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