Write out the ff3f model equation for tesla

Assignment Help Financial Management
Reference no: EM132027518

TESLA







SUMMARY OUTPUT
















Regression Statistics






Multiple R 0.231825432






R Square 0.053743031






Adjusted R Square 0.037428255






Standard Error 0.164962621






Observations 60















ANOVA








df SS MS F Significance F


Regression 1 0.089642128 0.089642 3.294132 0.074699515


Residual 58 1.578334656 0.027213




Total 59 1.667976783















Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 0.029619346 0.022746497 1.30215 0.198013 -0.015912715 0.075151 -0.01591272 0.075151406
X Variable 1 1.309325232 0.721401447 1.814975 0.0747 -0.134716657 2.753367 -0.13471666 2.753367121

Using above given linear regression summary output, write out the FF3F model equation for Tesla. Using the following factor information make a forecast of Tesla's next year's returns: Market excess return (8.01% EAR), SMB (1.97% EAR), HML (9.93% EAR), Risk-free rate (0.2% EAR).

Given the analysts' projected return for Tesla for FY 2017 of -8.7% EAR, determine whether the stock is over or undervalued in comparison to the FF3F's projection. The analysts' current recommendation for Tesla is to "hold" the stock. Do you agree with this recommendation?

Reference no: EM132027518

Questions Cloud

Allocate the purchase price to each asset : The James company has purchased a vehicle with an appraised value of $15,000, Their lump sum purchase price is $75,000. Allocate purchase price to each asset
How much overhead cost will be assigned to job : Keene Company allocates overhead on the basis of direct labor hours. How much overhead cost will be assigned to Job 1 after automation
What is a convertible bond : What is a callable bond? Does the call feature benefit the company that issues the bond or the bondholder? Why
Compute the material variances : Coffee Pot, Inc. is local chain of coffee shops. The standard amount of ground coffee per cup is 0.75 ounces. Compute the material variances
Write out the ff3f model equation for tesla : Determine whether the stock is over or undervalued in comparison to the FF3F's projection. write out the FF3F model equation for Tesla.
What is the present value of the tax savings : Assuming Ace used straight line depreciation, what is the present value of the tax savings from the depreciation on the speakers
Calculate the company fixed costs annually : Calculate the company's fixed costs annually? Calculate the average cost incurred by the company are now as many as 60 customers untukmelayani
What is the total contribution amount for slaphappy : Slaphappy's employer recently set up a 401(k) plan. He may defer up to 10% of his gross salary each year, What is the total contribution amount for Slaphappy
Prepare a multi step income statement for kim company : n 2016 Kim Company sold land for $110,000 cash. Operating expenses amounted to $44,000. Prepare a 2016 Multi Step Income statement for Kim Company

Reviews

Write a Review

Financial Management Questions & Answers

  How would you increase your sales and earnings

Although oil prices have been volatile, it is down significantly from over $100 per barrel to now mid $40s. It is assumed that the average household is saving money because of the lowered oil/gas prices. Yet the consumer is not spending on retail sto..

  Rosenthal and jacobson of the pygmalion effect

Describe the 1968 study by Rosenthal and Jacobson of the Pygmalion effect.

  Which project should be accepted on the basis of NPV

Ahmed is considering two independent projects with the following cash flows. The required return for both projects is 12%. Given this information, Which project should be accepted on the basis of IRR? Which project should be accepted on the basis of ..

  Payment and amount of interest and amount of principal

The payment and amount of interest and the amount of principal paid each calendar year,

  Corporate governance can affect shareholder value

You are also aware from your prior career and from your research, that corporate governance can affect shareholder value. This greatly concerns you, as you still have lofty plans for your company’s growth and eventual global trajectory. What characte..

  What steps would you take to implement an arbitrage strategy

You have the following information: S=65, X=60, T=1, r=0, C=7, P=4 Evaluating the situation from a Put-Call Parity framework, what steps would you take to implement an arbitrage strategy? Sell Call, Buy Put, Short Stock, Invest remainder Sell Call, B..

  What was most recent dividend per share paid on stock

Teder Corporation stock currently sells for $40 per share. The market requires a 14 percent return on the firm's stock. If the company maintains a constant 7 percent growth rate in dividends, what was the most recent dividend per share paid on the st..

  Hired as consultant for pristine urban-tech zither

You have been hired as a consultant for Pristine Urban-Tech Zither, Inc. (PUTZ), manufacturers of fine zithers. The market for zithers is growing quickly. The company bought some land three years ago for $1.35 million in anticipation of using it as a..

  Start saving for college education

Your parents start saving for your sister's college education. What is the required monthly deposit which will allow them to reach their goal?

  What does asset liablity management role for banks

What does asset liablity management role for banks? and for pension funds?

  Balance sheets and income statements for the years

present the accounts and dollar amounts that would appear on comparative balance sheets and income statements for the years ending 12/31/16 and 12/31/15.

  How much would it be willing to lend business owner

A small business owner visits her bank to ask for a loan. The owner states that she can repay a loan at $1,200 per month for the next three years and then $2,400 per month for two years after that. If the bank is charging customers 8.00 percent APR, ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd