Consider the following information regarding Domino Pizza Enterprizes Ltd, a listed company in Australia: Risk-free rate 2.2% Market Risk Premium 7.0% Beta of Share: 0.95 Last Dividend paid $4.50 (assume dividend only paid annually by Domino) Forecast dividend growth rate 3.0% Current Price of ordinary share $74.6 Required:  Value an ordinary share in Dominos using the Gordon Constant Growth Dividend Model and decide if you would recommend a purchase of a batch of shares in this company at current price level.

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Stock Yields

The stock yield is otherwise known as the dividend yield. The dividend yield is an annual payment of the stock dividends to the holder of a firm’s stock. The dividend yield is a financial ratio to measure the value of dividend payout every year for the relative stock price. The yield of a stock is usually shown in a percentage that discloses the expected future earnings from stock depending on the current stock price in the future. Stock yield will change depending on the market fluctuations and in accordance with the market fluctuations, the dividends will be increased or decreased by the firm.