Dividend growth model

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December 7, 2017 at 2:55 am #421368
richardscully
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hi

What happens if the return is greater than than the equity required by the market so you are dividing by a negative value. Required rate of return 10% and your dividend growth rate is 11.8%
December 7, 2017 at 7:15 am #421408
John Moffat
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That will never happen in the exam (and would not be realistic in real life either – it the growth rate was so high then shareholders would be bound to be requiring a higher return).
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