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Calculate Cost of Common Equity using CAPM (Capital Asset Pricing Model), DCF (Discounted Cash Flow Model) and Bond Yield Risk Premium CAPM data: VECs beta
Calculate Cost of Common Equity using CAPM (Capital Asset Pricing Model), DCF (Discounted Cash Flow Model) and Bond Yield Risk Premium
CAPM data:
VECs beta = 1.2
The yield on T-bonds = 3%
Market risk premium = 7%
DCF data:
Stock price = $27.08
Last years dividend (D0) = $2.10
Expected dividend growth rate = 4%
Bond-yield-plus-risk-premium data:
Risk premium = 5.5%
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