*Estimate Johnson & Johnsons approximate WACC; use the most recent years debt ratio to find the weights of debt and equity. (If J&J issues preferred stock, ignore it).

*Use CAPM to calculate their required rate of return on stock.

*Use the current 10-year Treasury bonds YTM as the risk-free rate. Using a reliable source, research the current markets expected rate of return (for example, the S&P 500).