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Silvercorp Metals Inc. Message Board

  • ich1banf40 ich1banf40 Apr 24, 2013 6:09 PM Flag

    SVM's Expected Stock Return is 14.8%

    Just did a simple CAPM calculation on SVM and found that SVM's Expected total return is 14.8% using the 5 year average Beta of 1.7, 10 year treasury yield of 1.70%, and the market return from January to April of 9.4%.

    I know this isn't a perfect model by any means, but just a quick and dirty computation based off of recent data as the market tends to internalize recent information and extrapolate it out into the future, hence why I chose the market's return year to date.

    This signals the bullish nature of SVM going forward but also the rate the market requires to be compensated for the extra risk of investing in a company with a beat of 1.7.

    Sentiment: Strong Buy

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