Answer Happy

Assume a major investment service hał just given Big Lake Realty its highest investment rating along with a strong buy recommendation. As a result, you decide to take a look for yourself and to place a value on the company's stock. Here's what you find. This year, Big Lake paid its stockholders an annual dividend of $5.33 a share, but because of its high rate of growth in earnings, its dividends are expected to grow at the rate of 9% a year for the next five years and then to level out at 6% a your So far, youve learned that the stock has a bota of 122, the risk-free rate of return is 28%, and the expected return on the market is 10.5%. Using the CAPM to find the required rate of return, put a value on this stock. CRED Using the CAPM, the required rate of return on the investment is 1219 %. (Round to two decimal places.) The value of the company's stock is (Round to the nearest cent.)