You will be given a company on the main London Stock Exchange. Discuss briefly the nature of activities of the company and its position in relation to the sector in an opening introductory page.
(a) Using weekly data of the last one year (31 Aug 2013- 1Sep 2014), estimate the market model for the share and interpret the outputs of these regressions.
(b) What is the yield curve? Discuss the main theories of the yield curve. Critically appraise the various possible uses of the yield curve in finance.
(c) Using the information from (a), (b) above, value the price of the share of your company as at 1 Sep 2014 using at least three alternative valuation techniques.
(d) Critically evaluate your results in (c) and with reference to academic literature and empirical research, advise which method of valuation you find appropriate for your company and make a buy, sell or hold recommendation on the company.
Good clear presentation, referencing, spelling and grammar.