Question
Levi Strauss & Co (LEVI) has a current price of $13.40 per share. Analysts estimate that the price per share of LEVI one year from
Levi Strauss & Co (LEVI) has a current price of $13.40 per share. Analysts estimate that the price per share of LEVI one year from today will be $15. LEVI will pay a dividend of $0.50 one year from today. Currently the risk-free rate is 5%, the market risk premium is 6% and LEVIs Beta is 1.19. Based on this information, how is LEVIs price position relative to fair value?
| Levi is undervalued | ||
| Levi is overvalued | ||
| Levi is fairly valued | ||
| There is not enough information to answer this question |
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Handbook Of Corporate Equity Derivatives And Equity Capital Markets
Authors: Juan Ramirez
1st Edition
1119975905, 978-1119975908
