Determine each company’s beta from a published source.

Industry: Retail, General – Walmart, Target, Dollar General

Beta is a measure of a stock’s volatility as compared to the overall equity market. Many investors use beta as a quick estimate of a stock’s risk. In this discussion forum, you will evaluate whether beta is a reliable estimate of risk for purposes of calculating a company’s cost of equity.

In your post (with a minimum of 300 words):

Choose a single industry and then three publicly traded companies from within that industry. For suggestions, review the list of Industries and Publicly Traded Companies Download Industries and Publicly Traded Companies .
Note: Be sure to choose an industry that no other classmate has selected.
Determine each company’s beta from a published source.
Hint: Use Yahoo!Finance (Links to an external site.) or NASDAQ (Links to an external site.) to find each company’s beta.
Find the company’s financial information by putting the company’s name in the search bar.
Compare each company’s beta to the industry average as provided on Aswath Damodaran’s website, Damodaran Online (Links to an external site.).
Search under Betas by Sector (US). From this page, go to Data, and within Data Breakdown select Industry, then under Discount Rate Estimation, select Levered and Unlevered Betas by Industry.
You may want to review the Search for Betas (Links to an external site.) handout for detailed instructions.
Explain, in your own words, what beta is and how it is calculated.
Explain whether beta is a reliable estimate of risk for purposes of evaluating an investment decision in one of the three companies in your selected industry.
Identify a scholarly article or source to support your opinion.
Include a link to this scholarly article or source in your post.

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