calculated as follows: first, download the historical monthly stock prices of BHP during the past 3 or 5 years and calculate the monthly returns on the stock. On Yahoo! Finance links above, you will find historical prices available on the menu under the heading titled "Historical Data". Open it to get the monthly stock prices for the period you choose. Next, you have to do the same for the market index (use S&P/ASX200 index) by downloading the monthly prices of the index for the past 3-5 years and calculate the return on the index. The link you need is as follows: https://au.finance.yahoo.com/q/hp?s=AXJO Finally, regress the monthly stock retums on the monthly index returns using the following regression: R = + BRm + The coefficient you obtain from the above regression is the stock's beta. Use the stock's beta, the risk free rate of retum and the long-run average stock return of 12% to calculate the required return according to the CAPM model. For BHP's stock, the required return is as follows = 1.91% +0.82 (12%-1.91%) = 10.2% Your report should include not only the valuation, but all important details about the firm. However, because the structure of equity valuation reports may vary from one firm to another, although the content is usually the same, I recommend you follow the following "Road Map": Section Mark Allocation Basic information and Investment Summary 3 Business Description 3 Industry Overview and Competitive position | 3 Financial analysis 4 Valuation 6 Investment Risk (internal and external) 3 Management and Governance 3 Sum 25 Please structure your report according to the above table. What to include under each section can be found in the following link: http://www.cfainstitute.org/community/challenge/Documents/re equity research report essentials.pdf The link above tells what to include in each section, but please follow the structure I mentioned in the above table when preparing your report. Finally, please do not forget to cite the source of any external information you borrow. All the best in your assignment!! 3