Stock publicly traded on the market

  Pick one stock publicly traded on the market other than Microsoft and use the template of Microsoft given to perform the followin" rel="nofollow">ing analysis on your stock   Q1: obtain" rel="nofollow">in the past dividend distributions in" rel="nofollow">information and the systematic risk factor beta to estimate the discount rate (both type of in" rel="nofollow">information can be obtain" rel="nofollow">ined from either Fin" rel="nofollow">inance Yahoo! or Mornin" rel="nofollow">ingStar) Then use the Dividend Discount Model (DMM) to estimate the fundamental stock price with the followin" rel="nofollow">ing four assumptions, respectively: 1) Assumin" rel="nofollow">ing that future annual dividends will remain" rel="nofollow">in the same as the current dividend. 2) Assumin" rel="nofollow">ing that each year future annual dividends will grow at a rate consistent with the company’s earnin" rel="nofollow">ings growth rate from fin" rel="nofollow">inancial analysis.3) Assumin" rel="nofollow">ing that each year future annual dividends will grow at an average rate of past dividend growth rates. 4) Assumin" rel="nofollow">ing that, each year of the next five years, dividends will grow at a non-constant rate and then achieve stable annual growth after 5 years. Compare the DDM estimated stock price under each assumption to the actual stock price on the market. Explain" rel="nofollow">in the difference between your projected stock price and the actual stock price under each assumption if there is any. Q2: estimate the stock price usin" rel="nofollow">ing Residual Income Model (RIM) with the in" rel="nofollow">information of past annual earnin" rel="nofollow">ings per share (EPS) of book value per share (BPS) of your stock. Compare the RIM estimated stock price to the actual stock price on the market. Explain" rel="nofollow">in the difference between the two stock prices if there is any. Q3: obtain" rel="nofollow">in historical earnin" rel="nofollow">ings per share (EPS), price/earnin" rel="nofollow">ings ratio (P/E), price/book value ratio (P/B), book value per share (BPS), price/sales ratio (P/B), price/cash flows (P/CF) and other key fin" rel="nofollow">inancial in" rel="nofollow">information from Mornin" rel="nofollow">ingStar. Estimate stock price and explain" rel="nofollow">in price differences with actual tradin" rel="nofollow">ing price by usin" rel="nofollow">ing price ratio analysis on 1) price/earnin" rel="nofollow">ings ratio (P/E)2) price/book value ratio (P/B)3) price/sales ratio (P/B)4) price/cash flows (P/CF) Q4: get the past five year daily stock price of your stock, and perform a run test on weak-form market efficiency. What can you conclude from the run test results? Q5: get the past five year daily stock price of your stock, and perform an autocorrelation test on weak-form market efficiency. Do the daily stock price appear to be autocorrelated