= $4.75 next year, and your advisory service tells you -$79. The stock's beta is 1.5, r, is 4%, and Elrml - 13 zurn)? 2.33%
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![You are considering buying a share of stock at a price of $73. The stock is expected to pay a dividend
of $4.75 next year, and your advisory service tells you that you can expect to sell the stock in 1 year
for $79. The stock's beta is 1.5, r, is 4%, and E[m] = 12%. What is the stock's alpha (abnormal
return)?
O 2.33%
-2.33%
O 1.27%
O 1.00%
O-1.27%
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- 1. You consider buying a share of stock at a price of $25. The stock is expected to pay a dividend of $1.50 next year, and your advisory service tells you that you can expect to sell the stock in 1 year for $30. The stock's beta is 1.1, rf is 6%, and market risk premium is 10%. What is the stock's alpha?Your broker has recommended that you purchase stock in ZZZ-Best, Inc. She estimates that the 1-year target price is $70, and ZZZ-Best consistently pays an annual dividend of $8. Based on your analysis, you estimate that the stock has a required rate of 18%. What is the intrinsic value of this stock? O $64.43 O $68.73 O $67.35 O $61.86 O $66.10Please answer both questions attached below in the image.
- Please answer both A stock is currently selling for $90.83 and is expected to sell for $102.27 in 1 year. If the company pays a dividend of $2.63 what is the stock's HPR? QUESTION 2 A stock has a beta of 1.18. The risk free rate is 0.974% and the market risk premium is 5%. What is the fair return on the stock?You consider buying a share of stock at a price of $950. The stock is expected to pay a dividend of $10 next year, and your advisory service tells you that you can expect to sell the stock in 1 year only for $945. What is the expected rate of return?A stock is expected to pay a dividend of $6.3 in two years and a $4.6 in three years. You are hoping that you can sell it for $100 at that time. If the required return is 9.3%, what is the stock's value? Round to 2 decimal places. Answer:
- Consider a stock that wil have price of $31 54 one year from now and pay a dividend of $3.28 in one year. The expected rate of returm is 3.5%. What is the current price of the stock? Enter your response below rounded to 2 DECIMAL PLACES. NumberYou are thinking of buying a stock priced at $98 per share. Assume that the risk-free rate is about 4.7% and the market risk premium is 5.5%. If you think the stock will rise to $122 per share by the end of the year, at which time it will pay a $1.74 dividend, what beta would it need to have for this expectation to be consistent with the CAPM? The beta is (Round to two decimal places.)A share of stock with a beta of 0.76 now sells for $51. Investors expect the stock to pay a year-end dividend of $2. The T-bill rate is 3%, and the market risk premium is 7%. a. Suppose investors believe the stock will sell for $53 at year-end. Calculate the opportunity cost of capital. Is the stock a good or bad buy? What will investors do? (Do not round intermediate calculations. Round your opportunity cost of capital calculation as a percentage rounded to 2 decimal places.) b. At what price will the stock reach an “equilibrium” at which it is perceived as fairly priced today? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
- Suppose you are thinking of purchasing the SunStar’s common stock today. If you expect SunStar to pay $0.80 dividend at the end of year one and $1.6 dividend at the end of year two and you believe that you can sell the stock for $15 at that time. If you required return on this investment is 10%, how much will you be willing to pay for the stock? a. $13.95 b. $14.44 c. 14.19 d. $15.51You are interested in buying a stock today, which sells for $95 per share. You believe that the right time to sell this stock is three years later. During your investment, you expect to receive the following dividends: D1 (dividend at the end of year 1) = $4, D2 = $4.50, and D3 = $5. If you required rate of return is 11% per year, what is the expected stock price at Year 3? (Hint: Your investment horizon is three years) O $112.25 $115.00 O $113.75 $110.50 $116.25Suppose the current price of a stock is $50 per share. You expected to earn a 10% return on the stock if you buy it at the current market price and hold it for one year (right after you receive the dividend for the year). The stock is expected to pay a dividend of $2.5 per share, what do you expect the stock price to be one year from now? • Suppose the current price of a stock is $50 per share. You expected to earn a 10% return on the stock if you buy it at the current market price and hold it for one year (right after you receive the dividend for the year). The stock one year from now is expected to be $53, how much dividend do you expect to receive during the year .
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