A manager believes his firm will earn a return of $17\mathrm{.}90$ percent next year. His firm has a beta of $1\mathrm{.}58,$ the expected return on the market is $14\mathrm{.}20$ percent, and the risk$-$free rate is $4\mathrm{.}20$ percent.

Compute the return the firm should earn given its level of risk.

Note: Round your answer to $2$ decimal places.

Determine whether the manager is saying the firm is undervalued or overvalued.