Corporate Finance.docx - Running head CORPORATE FINANCE 1...

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Running head: CORPORATE FINANCE 1 Corporate finance Name Institution Date
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CORPORATE FINANCE 2 The rate of return is explained as the net gain or the net loss on a specific investment for a given time. Generally, the rate of return is expressed in percentage form of the total cost of the particular investment. This paper will mainly focus on the stock valuation, the total return, the CAPM, floatation costs and the WACC. Stock Valuation Stock valuation is an essential financial tool which assists in the determination of the worth of stocks of a given business. In addition, stock valuation determines the profitability of stocks as well as the future trend. Stock valuation is a method which makes use of standard formulas in evaluating the worth of stocks of a particular organization. It is mainly used to predict the results, returns and the future prices of the organization’s stock based on the behavior of the present market. For the long-term operations, business organizations need fund to support operations by giving out stocks and bonds. Stock valuation is the main step to smart investment since it assists the investors are making informed decisions ( Ross et al., 2016) .
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