Question
1,Choose a US publicly traded company that has daily trading volume of at least one million shares. 2. Look up the financial statements of that
1,Choose a US publicly traded company that has daily trading volume of at least one million shares.
2. Look up the financial statements of that company.
3. Using the Constant Dividend Growth Model, and the P/E ratio perform valuation/prediction of the firm's stock price. a. For the Constant Dividend Growth Model, find current dividends per share from the income statement. Estimate the dividend growth rate. Estimate the discount rate using the CAPM. (Note: Some stocks don't pay dividends. If that is the case, then state that and skip the dividend model.) b. P/E ratio: Find or estimate the EPS growth rate. (You can use the same EPS growth rate from part a.) Predict next year's EPS. Then predict next year's stock price using the average P/E ratio. (Use the average P/E of the last five years.)
4. Make a prediction about whether the stock is underpriced or overpriced.
I chose the company named Simon Property Group, Inc. (SPG). NYSE - NYSE
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