You expect the GP to hit $58 per share with expected dividends of $0.75 in one...

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You expect the GP to hit $58 per share with expected dividends of $0.75 in one...

You expect the GP to hit $58 per share with expected dividends of $0.75 in one year. Its current price is $46 and your research estimates the beta at 1.15. Market risk premium is .07 and the U.S. T-bill is expected to yield .05. Is the GP a good investment? Explain your answer.

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Answer 1

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Ctke) kthee Pi Bberked Pice DL Expecked Dividand Ke bhactd Rabum Po Current Paice $46 $58+$0.75 CItKa) Itke) 5%.75 146 Ke = I Since, the erhucted Retum is mmdse than heauied Retun,thu GP stock has csiated the alpha, Thee ore he shoulel imvest in GPsto

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Add Answer to: You expect the GP to hit $58 per share with expected dividends of $0.75 in one...

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You expect the GP to hit $58 per share with expected dividends of $0.75 in one...