Simple question that I'm having some trouble thinking through - After calculating a comps-based valuation, is it appropriate to add the Co's expected yield to calculate a 1-yr expected holding period return?
A simple example:
Peer Avg. P/E: 11x
Expected Return: $1/share (multiple expansion) + $1/share dividend received = $2/share or 20% return
I apologize if this is a dumb question but appreciate the help. Can't seem to determine if I'm double counting the dividend here. Thanks!