2. Assumptions
Cap Rate Calculations Cost of Equity/CAPM 7.52%
Risk Free Rate 1.83% 10 year note
Beta 0.83 Capital IQ
S&P Growth 8.69% Capital IQ
Growth of revenue is going to vary as defense
spending is unknown so there are decreases and
increases in revenue to account for volatility
Small Appliances and Absorbent products appear to
be on track for constant modest growth in the future
4. Recommendations
The current stock price is $97.72 which is higher
then the calculated price from the DCF
What this means
The price is not drastically above the DCF price which would
indicate a tentative hold if already owning the stock because
the calculations are built on estimates
A prospective buyer would be cautious of purchasing the stock
and would be smart to wait and watch the stock for a period of
time