This paper circulates around the core theme of In this step, you have been asked to visit a credible Web site that provides detailed information on publicly traded stocks and select 1 that has at least a 5-year history of paying dividends and 2 of its closest competitors. together with its essential aspects. It has been reviewed and purchased by the majority of students thus, this paper is rated 4.8 out of 5 points by the students. In addition to this, the price of this paper commences from £ 99. To get this paper written from the scratch, order this assignment now. 100% confidential, 100% plagiarism-free.
In this step, you have been asked to visit a credible Web site that
provides detailed information on publicly traded stocks and select 1
that has at least a 5-year history of paying dividends and 2 of its
closest competitors.
To fill up the first table, you will need to gather information
needed to calculate the required rate of return for each of the 3
stocks. You will need to calculate the risk-free rate for this
assignment. You will need the market return that was calculated in Phase
2, and the beta that you should be able to find on the Web site.
|
Company
|
5-year Risk-Free Rate of Return
|
Beta (?)
|
5-Year Return on Top 500 Stocks
|
Required Rate of Return (CAPM)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To complete the next table, you will need the most recent dividends
paid over the past year for each stock, expected growth rate for the
stocks, and the required rate of return you calculated in the previous
table. You will also need to compare your results with the current value
of each stock and determine whether the model suggests that they are
over- or underpriced.
|
Company
|
Current Dividend
|
Projected Growth Rate (next year)
|
Required Rate of Return (CAPM)
|
Estimated Stock Price (Gordon Model)
|
Current Stock Price
|
Over/Under Priced
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In the third table, you will be using the price to earnings ratio
(P/E) along with the average expected earnings per share provided by the
Web site. You will also need to compare your results with the current
value of each stock to determine whether or not the model suggests that
the stocks are over- or underpriced.
Company
Estimated Earning
(next year)
P/E Ratio
Estimated Stock Price (P/E)
