Question: Weisman Electronics from the previous problem is considering acquiring an unrelated business. Management thinks the move could change the firms stock price by moving its

Weisman Electronics from the previous problem is considering acquiring an unrelated business. Management thinks the move could change the firm’s stock price by moving its beta up or down and decreasing its growth rate. A consultant has estimated that Weisman’s beta after the acquisition could be anywhere between 1.3 and 1.7 while the growth rate could remain at 4% or decline to as little as 3%. Calculate a range of intrinsic values for Weisman’s stock based on best-and-worst case scenarios.

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