Buying stock

You are considering the purchase of the common stock of Herro Corporation. Given the following information, explain whether or not if you would buy the stock. Support your conclusions with computations. The current market price of Herro is $100 per share. The one-year target estimated price is $122 per share. The dividend per share is $2.00. The beta for Herro is 1.60. The risk free rate is 2.0%. The market risk premium is 6.0%.

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