| Unit 3 IP Template |
| Step 1 |
| Bond | Company / Rating | Face Value (FV) | Coupon Rate | Annual payment (PMT) | Time-to-Maturity (NPER) | Yield-to-Maturity (RATE) | Market Value (Quote) | Discount, Premium, Par | | | AAA | BBB | CCC |
| A-Rated | | $ 1,000 | | | | | | | | Maturity |
| B-Rated | | $ 1,000 | | | | | | | | Today |
| C-Rated | | $ 1,000 | | | | | | | | Days |
| | | | | | | | | | | Years |
| Step 2 |
| Company | 5-year Risk-Free Rate of Return (Rf) | Beta | 5-Year Return on Top 500 Stocks (k) | Required Rate of Return (CAPM) | | 5 years ago (PV) | Current (FV) |
| Company 1 |
| Company 2 |
| Company 3 |
| CAPM = Rf + Beta * (k - Rf) |
| Step 3 |
| Company | Current Dividend | Project Growth Rate (next year) (g) | Required Rate of Return (CAPM) (k) | Estimated Stock Price (Gordon Model) | Current Stock Price | Over/Under Priced |
| Company 1 |
| Company 2 |
| Company 3 |
| Gordon Model = (Current Dividend * (1 + g)) / (k - g) |
| Step 4 |
| Company | Estimated Earnings (next year) (EPS) | P/E Ratio | Estimated Stock Price (P/E) | Current Stock Price | Over/Under Priced |
| Company 1 |
| Company 2 |
| Company 3 |
| Estimated Stock Price (P/E) = EPS * P/E Ratio |
| References |
Olenaz808
Unit3IPTemplate.xlsx
