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Nine Point Industries recently paid its annual dividend of $4.42, and reported an ROE of 8%. The firm pays out 50% of its earnings as dividends. The stock has a beta of 1.62. The current risk-free rate is 3.45% and the market return is 18.00%. Assuming that CAPM holds, what is the intrinsic value of this stock? DO NOT ENTER THE $ SIGN. ALSO, ENTER YOUR ANSWER AS A POSITIVE NUMBER. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO TWO DECIMAL PLACES AT THE END, i.e. IF YOUR ANSWER IS 33.4343 ENTER IT AS 33.43 ONLY

Nine Point Industries recently paid its annual dividend of $4.42, and reported an ROE of 8%. The firm pays out 50% of its earnings as dividends. The stock has a beta of 1.62. The current risk-free rate is 3.45% and the market return is 18.00%. Assuming that CAPM holds, what is the intrinsic value of this stock? DO NOT ENTER THE $ SIGN. ALSO, ENTER YOUR ANSWER AS A POSITIVE NUMBER. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO TWO DECIMAL PLACES AT THE END, i.e. IF YOUR ANSWER IS 33.4343 ENTER IT AS 33.43 ONLY

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Nine Point Industries recently paid its annual dividend of $4.42, and reported an ROE of 8%. The firm pays out 50% of its earnings as dividends. The stock has a beta of 1.62. The current risk-free rate is 3.45% and the market return is 18.00%. Assuming that CAPM holds, what is the intrinsic value of this stock? DO NOT ENTER THE $ SIGN. ALSO, ENTER YOUR ANSWER AS A POSITIVE NUMBER. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO TWO DECIMAL PLACES AT THE END, i.e. IF YOUR ANSWER IS 33.4343 ENTER IT AS 33.43 ONLY
Transcribed Image Text:Nine Point Industries recently paid its annual dividend of $4.42, and reported an ROE of 8%. The firm pays out 50% of its earnings as dividends. The stock has a beta of 1.62. The current risk-free rate is 3.45% and the market return is 18.00%. Assuming that CAPM holds, what is the intrinsic value of this stock? DO NOT ENTER THE $ SIGN. ALSO, ENTER YOUR ANSWER AS A POSITIVE NUMBER. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO TWO DECIMAL PLACES AT THE END, i.e. IF YOUR ANSWER IS 33.4343 ENTER IT AS 33.43 ONLY
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