Landon Stevens is evaluating the expected performance of two common stocks, Furhman Labs, Inc., and Garten Testing, Inc. The risk$-$free rate is $4\mathrm{.}6$ percent, the expected return on the market is $11$ percent, and the betas of the two stocks are $1\mathrm{.}6$ and $0\mathrm{.}9,$ respectively. Stevens$$s own forecasts of the returns on the two stocks are $15\mathrm{.}2$ percent for Furhman Labs and $11\mathrm{.}00$ percent for Garten.

$1.$

Calculate the required return for each stock. $($Round your answer to $2$ decimal places. Omit the $"\%"$ sign in your response.$)$

Stock Required return

Furhman Labs $\%$

Garten Testing $\%$

$2.$ Is each stock undervalued, fairly valued, or overvalued?

Furhman Labs

multiple choice $1$

Undervalued

Overvalued

Fair valued

Garten Testing

multiple choice $2$

Fair valued

Undervalued

Overvalued