JJM has a beta coefficient of 1.2. currently the risk free rate is 2 percent and the anticipated return on the market is 8 percent. JJM pays a $4.50 dividend that is growing at 4 percent annually. A....


JJM has a beta coefficient of 1.2. currently the risk free rate is 2 percent and the anticipated return on the market is 8 percent. JJM pays a $4.50 dividend that is growing at 4 percent annually.


A. what is the required return for JJM?


B. GIVEN THE REQUIRED RETURN, WHAT IS THE VALUE OF THE STOCK?


C. IF THE STOCK IS SELLING FOR $100, WHAT SHOULD YOU DO?


D. IF THE BETA COEFFICIENT DECLINES TO 1.0, E=WHAT IS THE NEW VALUE OF THE STOCK?


E. IF THE PRICE REAMINS $100, WHAT COURSE OF ACTION  SHOULD YOU TAKE GIVEN THE VALUATION IN D?



Jun 01, 2022
SOLUTION.PDF

Get Answer To This Question

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here