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AAFM CWM_LEVEL_2 Exam - Topic 6 Question 2 Discussion

Actual exam question for AAFM's CWM_LEVEL_2 exam
Question #: 2
Topic #: 6
[All CWM_LEVEL_2 Questions]

Section C (4 Mark)

Read the senario and answer to the question.

Neeraj's portfolio consist shares of company X Ltd. which is paying a dividend of Rs. 2 per share. The dividend is expected to grow @15% annual rate for 3 years, then @10% for the next 3 years, after which it is expected to grow @5% forever. What among the following would be your advice to Neeraj in case the market value of the share is Rs. 85? Assume capitalization rate to be 9% per annum

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Suggested Answer: D

by Justine at May 04, 2022, 08:04 PM

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Jesusita
19 days ago
Not sure about that advice, seems risky to hold.
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Tien
24 days ago
Definitely keep the shares, they’re worth more long-term!
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Reena
29 days ago
Wait, how can the market price be higher than the current value?
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Kanisha
1 month ago
I think he should sell if the market price is higher.
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Benedict
1 month ago
The dividend growth is solid at 15% for 3 years!
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Julie
2 months ago
}
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Aleta
2 months ago
}
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Gilma
2 months ago
"So intrinsic value around 77; market price 85 means the price is higher than intrinsic—likely not a buy."
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Corrie
2 months ago
"Candidate 4",
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Valda
2 months ago
},
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Gilma
2 months ago
"D1=2.30, D2=2.645, D3=3.04175, D4=3.3459, D5=3.6805, D6=4.0486; TV6 ≈ 106.28; PV ≈ 77 (not totally sure about the math)."
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Mireya
3 months ago
{
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Corrie
3 months ago
"Candidate 3",
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Kattie
3 months ago
{
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Twana
3 months ago
]
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Dana
3 months ago
},
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Gilma
4 months ago
"This echoes the non-constant growth practice I did last week, with a terminal value at year 6."
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Corrie
4 months ago
"Candidate 2",
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Santos
4 months ago
{
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Mona
4 months ago
},
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Gilma
4 months ago
"Three-stage DDM here: 15% growth for 3 years, then 10% for 3, then 5% forever; discount at 9%."
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Corrie
5 months ago
"Candidate 1",
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Annalee
5 months ago
{
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Loreen
5 months ago
[
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Fannie
5 months ago
{
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Octavio
5 months ago
Okay, let's see here. The key things I need to focus on are the shared credentials, timeout, and separate log file prefixes. I think I have a strategy to tackle this.
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Alecia
5 months ago
This question seems straightforward, I think I know the answer is D based on the description.
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Justa
5 months ago
Hmm, this looks like a tricky one. I'll need to carefully review the disk details to determine which one is the best fit for the Azure Virtual Desktop session host.
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