Question

In: Finance

Value and Returns A stock has an expected dividend yield of 3.8% a price today of...

Value and Returns A stock has an expected dividend yield of 3.8% a price today of $30 and an expected sale price in one year of $33. The stock has a beta of 1.2 and the expected return on the market is 10% while the risk free rate is 5%. This stock is _____________ by ________ basis points.

overvalued; 143

undervalued; 280

undervalued; 143

overvalued; 280

Solutions

Expert Solution


Related Solutions

A stock's price today is $20.75, and it is expected to pay out a dividend of...
A stock's price today is $20.75, and it is expected to pay out a dividend of $0.50 per share in one year. What is the stock's expected dividend yield? (Enter your answer as a decimal rounded to 4 decimal places, not a percentage). For example, enter .0153 instead of 1.53%.
A stock sells today for $130. The price of the stock in a year is expected...
A stock sells today for $130. The price of the stock in a year is expected to be $140. The annual volatility of the stock is 30%. a. Calculate the probability that in six years the stock will sell for more than $150. b. Calculate the probability that in six years the stock will sell for less than $115. c. Calculate the probability that in six years the stock will sell for a price between $120 and $160. d. You...
The expected total return on a share of stock minus the total expected dividend yield equals...
The expected total return on a share of stock minus the total expected dividend yield equals the total expected capital gains yield. True or False
Krell Industries has a share price of $21.25 today. If Krell is expected to pay a dividend of $1.06
Krell Industries has a share price of $21.25 today. If Krell is expected to pay a dividend of $1.06 this​ year, and its stock price is expected to grow to $24.73 at the end of the​ year, what is​Krell's dividend yield and equity cost of​ capital?A) Krell's dividend yield is?B) Krell's capital gain rate is?C) Krell's equity cost of capital, or expected total return is?
Calculate the present value of a stock if this stock is expected to pay $10.60 dividend...
Calculate the present value of a stock if this stock is expected to pay $10.60 dividend in the next three years and then $15 for year 4 to year 6, and in year 7 and thereafter it pays $20 constant dividend forever. Assume investors opportunity cost of investment is 10%. provide excel formula in your answer and briefly explain the steps in your calculations
Jacobson, Inc. has common stock with market price of $50 and expected to pay dividend of...
Jacobson, Inc. has common stock with market price of $50 and expected to pay dividend of $2.50 per share at the end of the year. You intend to purchase the stock at the market price, hold it for one year, and sell it after a dividend of $2.50 is paid. How much will the stock price have to appreciate for you to satisfy your required rate of return of 12 percent? You intend to purchase the stock today, hold it...
You are buying a share of UTD stock today. UTD is expected pay a dividend of...
You are buying a share of UTD stock today. UTD is expected pay a dividend of $1.50 per share at the end of the year 2 and a $2.50 per share at the end of the year 3. You expect UTD 's stock price to be $20.00 at the end of year 3 (right after the $2.50 dividend is paid). UTD 's equity cost of capital is 10%. a. What is the price of UTD stock per share today? b....
If the price for Apple stock is $44 today, and the dividend next period is $3.50...
If the price for Apple stock is $44 today, and the dividend next period is $3.50 and the price next period is expected to be $36, what is the capital gains yield? A) 18.182% B) - 18.182% C) 7.954% D) 22.22% E) - 10.228%
The stock has the following returns and probabilities of those returns. What is the expected return...
The stock has the following returns and probabilities of those returns. What is the expected return and risk of the stock using the data? Use your knowledge (weighted average of returns to calculate expected return and standard deviation of returns to calculate risk). return probability 6% 70% 15% 30% Also, How do you calculate portfolio beta? I have this problem and have not been able to calculate the correct answer. Using the table below what is the beta of the...
What is the expected return of a stock given stock price and dividend information? (show formula)...
What is the expected return of a stock given stock price and dividend information? (show formula) What is dividend yield and capital gain yield of stock investment? (show formula)
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT