R/55_computingRwithHmodel.R

In stockAnalyst: Equity Valuation using Methods of Fundamental Analysis

#'Calculates the required rate of return on equity using two stage H-Model.
#'@details
#'According to information provided Jerald E. Pinto (2020), the method \code{computingRwithHmodel} is developed to compute the required rate of return on equity using two stage H-Model for the values passed to its six arguments.Here, \code{divNot} is dollar value of the current dividend , \code{spNot} is current share price, \code{n} is number of years of super-normal growth period, \code{H} is which is one-half of n (that is the length of the super-normal growth period), \code{gS} is initial short-term dividend growth rate, and \code{gL} is normal long-term dividend growth rate after Year 2H (that is \code{n}).
#'@param divNot A number.
#'@param spNot A number.
#'@param n A number.
#'@param H A number.
#'@param gS A number.
#'@param gL A number.
#'@return Input values to six arguments  \code{divNot} , \code{spNot} , \code{n}, \code{H}, \code{gS} and \code{gL}.
#'@author MaheshP Kumar, \email{maheshparamjitkumar@@gmail.com}
#'@references
#'Pinto, J. E. (2020). Equity Asset Valuation (4th ed.). Wiley Professional Development (P&T). https://bookshelf.vitalsource.com/books/9781119628194
#'@examples
#'computingRwithHmodel(divNot=1,spNot=20,n=10,H=10/2,gS=0.10,gL=0.06)
#'@export
computingRwithHmodel <-function(divNot,spNot, n,H,gS,gL){
  r <- (divNot/spNot)*((1+gL)+ H*(gS-gL)) + gL
  (r = round(r, digits=3))
}