a. You are going to value Lauryns Doll Co. using the FCF model. After consulting various sources, you find that Lauryn's has a reported equity beta of 1.7, a debt-to-equity ratio of .7, and a tax rate of 21 percent. Based on this information, what is the asset beta for Lauryns? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

b.A certain stock has a beta of 1.3. If the risk-free rate of return is 3.9 percent and the market risk premium is 7.4 percent, what is the expected return of the stock? What is the expected return of a stock with a beta of 1.21? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

c. Could I Industries just paid a dividend of $1.20 per share. The dividends are expected to grow at a rate of 17 percent for the next six years and then level off to a growth rate of 4 percent indefinitely. If the required return is 16 percent, what is the value of the stock today? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

d.Beagle Beauties engages in the development, manufacture, and sale of a line of cosmetics designed to make your dog look glamorous. Below you will find selected information necessary to compute some valuation estimates for the firm. Assume the values provided are from year-end 2019. Also assume that the firms equity beta is 1.40, the risk-free rate is 2.35 percent, and the market risk premium is 9.0 percent.

Dividends per share	$	2.14
Return on equity		11.50	%
Book value per share	$	17.80

	Earnings			Cash Flow			Sales
2019 value per share	$	5.00		$	6.50		$	25.65
Average price multiple		13.10			9.47			2.41
Forecasted growth rate		13.53	%		11.36	%		7.16	%

Using the PE, P/CF, and P/S ratios, estimate the 2020 share price for Beagle Beauties. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

e. Lauryns Doll Co. had EBIT last year of $56 million, which is net of a depreciation expense of $5.6 million. In addition, Lauryns made $5.3 million in capital expenditures and increased net working capital by $2.7 million. Assume that Lauryns has a reported equity beta of 1.7, a debt-to-equity ratio of .4, and a tax rate of 21 percent. What is Lauryns FCF for the year?(Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)

f. Lauryns asset beta is 1.11. Calculate the appropriate FCF discount rate assuming a risk-free rate of 3 percent and a market risk premium of 12 percent. (Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place.)

g. Leisure Lodge Corporation is expected to pay the following dividends over the next four years: $21.00, $10.00, $7.20 and $2.50. Afterwards, the company pledges to maintain a constant 3 percent growth rate in dividends forever. If the required return on the stock is 15 percent, what is the current share price? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

h. Xytex Products just paid a dividend of $2.17 per share, and the stock currently sells for $40. If the discount rate is 13 percent, what is the dividend growth rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

i. The ACME Corporation has current sales per share of $10.55. The sales per share are expected to increase at an annual rate of 12 percent. The historical P/E ratio is 16.2 and the historical P/S ratio is 9.8. What is the expected price of this stock one year from now?

j. Bills Bakery has current earnings per share of $2.58. Current book value is $4.40 per share. The appropriate discount rate for Bills Bakery is 10 percent. Calculate the share price for Bills Bakery if earnings grow at 2.9 percent forever. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

k. Johnson Products earned $4.30 per share last year and paid a dividend of $1.65 per share. If ROE was 16 percent, what is the sustainable growth rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

l. The ACME Corporation has current sales per share of $10.55. The sales per share are expected to increase at an annual rate of 12 percent. The historical P/E ratio is 16.2 and the historical P/S ratio is 9.8. What is the expected price of this stock one year from now?

m.

Which one of the following Arms values is the least bearish?

Multiple Choice

.88

.45

1.03

.28

1.26

n

Which one of the following market sentiment index (MSI) values represents the worst buying opportunity?

Multiple Choice

.61

.16

.82

.29

.48