Using the capm to find the required rate of? return

Assignment Help Financial Management

Reference no: EM131984530

Assume a major investment service has just given Oasis Electronics its highest investment? rating, along with a strong buy recommendation. As a? result, you decide to take a look for yourself and to place a value on the? company's stock. ? Here's what you? find: This? year, Oasis paid its stockholders an annual dividend of ?$2.11 a? share, but because of its high rate of growth in? earnings, its dividends are expected to grow at the rate of 11?% a year for the next 4 years and then to level out at 8?% a year. So? far, you've learned that the stock has a beta of 1.92?, the? risk-free rate of return is 7?%, and the expected return on the market is 11?%. Using the CAPM to find the required rate of? return, put a value on this stock.

Reference no: EM131984530

Questions Cloud

Describe the similarities between the treatment : Describe the similarities between the treatment of the Other by the white Westerners in Narayan's "A Horse and Two Goats" and Silko

The practical method and again by the theoretical method : It is sold after 45 months for $995. Find the accrued interest by the practical method and again by the theoretical method.

Discuss the theme of the anguish of living in the world : Discuss the theme of the anguish of living in the world divided by relentless conflict, based on one or more poems by Celan

Under COBRA after Bill is no longer eligible for the plan : How long can Beth be covered under COBRA after Bill is no longer eligible for the plan?

Using the capm to find the required rate of? return : Using the CAPM to find the required rate of? return, put a value on this stock.

How do students actually feel about the intervention : PSY635 - How do their students actually feel about the intervention and How do students view the influence of the intervention on their learning inside

Prevent family violence in our society : Can you think of at least one way that we could prevent family violence in our society?

Good standing with financial aid : How many hours do you need a year to be in good standing with Financial Aid? What are three common issues students face during their first year in college?

Calculate the realized rate of return for an investor : Compute the realized rate of return for an investor who purchased the bonds when they were issued and held the until they were called.

User Account

All Pages