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Technology Stocks : WDC/Sandisk Corporation
WDC 236.39-2.8%Jan 23 9:30 AM EST
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To: Andre Williamson who wrote (24701)1/22/2004 9:19:30 PM
From: Dave  Read Replies (2) of 60323
 
Andre:

From the very beginning, I always asserted that a business is worth the Present Value of all, expect future cash flows. Therefore, let's ignore metrics.

When you say that you calculated Sandisk's Cost of Capital, how did you calculate it's Beta? What did you use for your equity risk premium? Remember, SanDisk is predominantly equity funded therefore, the majority of its cost of capital is captured in ke (req'd return for equity)

I'm curious what u used. I quickly regressed Sandisk's returns vs. the S&P 500 using a little over 5 years of data and looking at monthly returns. I got a beta of 3.31
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