R_RF = 2.7500%

R_m = 9.0000%

Beta = 1.25

• CALCULATE REQUIRED RATE OF RETURN

NEXT dividend = $3.15

GROWTH rate = 3.5000%

MARKET PRICE = $32.90

• CALCULATE THE EXPECTED RATE OF RETURN
• CALCULATE EQUILIBRIUM STOCK PRICE$

CALCULATE the REQUIRED RATE OF RETURN ___________________________

CALCULATE the EXPECTED RATE OF RETURN ___________________________

IS THE STOCK PRICE OVER or UNDER VALUED? ___________________________

CALCULATE THE EQUILIBRIUM STOCK PRICE$ ___________________________