Calculating Cost of Equity Equity in Landsvg AG has a beta of 0.85. The market risk premium

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Calculating Cost of Equity Equity in Landsväg AG has a beta of 0.85. The market risk premium is 8 per cent, and T-bills are currently yielding 5 per cent. The company’s most recent dividend was SKr1.60 per share, and dividends are expected to grow at a 6 per cent annual rate indefinitely. If the equity sells for SKr37 per share, what is your best estimate of the company’s cost of equity?

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Fundamentals Of Corporate Finance

ISBN: 9780077178239

3rd Edition

Authors: David Hillier, Iain Clacher, Stephen A. Ross

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