Sunday, February 17, 2013

Vicom

My apologies for the long gap in writing, have been terribly busy and blog posts had taken a back seat.

SGX has a new tool on its site which allows you as an investor to calculate the dividend discount pricing for a stock.

http://www.sgx.com/wps/portal/sgxweb/home/investor_tools/dividend_discount_calculator

This above is the URL for the tool.

Applying this tool to Vicom, we can see

a) Current earnings is 29.89 cents per share
b) Annual dividend is 18.2 cents per share
c) Earnings is growing at 4.2%

Assuming one wants 8% return for investments, then using a five year window, the price is 5.1 for Vicom.

Using a 1 year window is 5.06 and a twenty year window it is worth 5.2 as on date.

The share is priced at 5.06.

No great discount available, so, if you buy at this price, you are paying fair value.