Korea Financial Investment Analyst

Practice session

A dividend-paying stock recently distributed an annual cash dividend of D₀ = KRW 2,000 per share. An equity research analyst forecasts that dividends will grow indefinitely at a constant annual rate of g = 5.0%. If the market required rate of return for this equity risk profile is k = 10.0%, what is the theoretical intrinsic value of the stock using the Gordon Constant Growth Dividend Discount Model (고든 배당할인모형)?

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