Calculate the intrinsic value

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Reference no: EM132014693

Suppose that ABC stock has an expected dividend per share, E(D1) of $5, that the current price is $50, that the expected price at the end of the year is, E(P1), is $54, and that its beta is 1.2.

(a) Calculate the intrinsic value of ABC. Relative to the market, is ABC underpriced, overpriced, or fairly valued?

(b) Calculate ABC’s ?.

Reference no: EM132014693

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