Use capm to calculate your companys required rate of return


Estimate CVS Health Corps approximate WACC; use the most recent year’s debt ratio to find the weights of debt and equity. If your company issues preferred stock, for simplicity’s sake, ignore it. The cost of debt will be the approximate YTM. Use CAPM to calculate your company’s required rate of return on stock. use the current 10-year Treasury bonds’ YTM as the risk-free rate. Using a reliable source, research the current market’s expected rate of return (for example, the S&P 500).

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Financial Management: Use capm to calculate your companys required rate of return
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