Intrinsic value of stock


StoreAge Inc. recently paid its annual dividend ($1.00), and reported an ROE of 15%, of which 50% is paid as dividends. The stock has a beta of 1.00. The current risk-free rate is 2.10% and the market risk premium (RM - RF) is 9.00%. Assuming that CAPM holds, what is the intrinsic value of this stock?

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Finance Basics: Intrinsic value of stock
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