Landon Stevens is evaluating the expected performance of two common stocks, Furhman Labs, Inc., and Garten Testing, Inc. The risk$-$free rate is $3\mathrm{.}5$ percent, the expected return on the market is $11\mathrm{.}5$ percent, and the betas of the two stocks are $1\mathrm{.}2$ and $\mathrm{.}9,$ respectively. Landon's own forecasts of the returns on the two stocks are $13\mathrm{.}75$ percent for Furhman Labs and $10\mathrm{.}50$ percent for Garten.

a$.$ Calculate the required return for each stock.

b$.$ Is each stock undervalued, fairly valued, or overvalued? Explain. $($Hint: If the forecast return is less $($greater$)$ than the required rate of 'return, the security is overvalued $($undervalued$).)$