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You are working on a valuation for Seagate Technologies. To do your discounted cash flow analysis, you decide to use a multifactor model that explains
You are working on a valuation for Seagate Technologies. To do your discounted cash flow analysis, you decide to use a multifactor model that explains returns based on the size and value of the company. The Company has a market beta of 1.1, a size beta of 0.4, and a value beta of 0.5. The expected return on the S&P500 is 10%, the risk premium for size is 3.0%, and the Risk Premium for value is 4.2%. The yield on 10-year government bonds is 5%. What is the expected return on Seagate Technology stock using the Multi-Factor Model? You are working on a valuation for Seagate Technologies. To do your discounted cash flow analysis, you decide to use a multifactor model that explains returns based on the size and value of the company. The Company has a market beta of 1.1, a size beta of 0.4, and a value beta of 0.5. The expected return on the S&P500 is 10%, the risk premium for size is 3.0%, and the Risk Premium for value is 4.2%. The yield on 10-year government bonds is 5%.
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