29a)You seek to determine the Comps-price of See-It Industries common stock. The stock currently sells for $21.1 per share, and is expected to have earnings per share next year of $2.84 per share. Based on risk, the fair discount rate of See-Its common stock is estimated to be 11.3% per year.

Within the same industry there are a host of competing firms. Of those, three of them appear to have operations that are closely aligned with See-It Industries. Those firms, (i) Vision, (ii) XOut and (iii) Zeekum, currently trade at stock prices of $39, $52, and $42 per share, respectively. Next year the three firms are expected to have earnings per share of $2.82, $3.15, and $1.87 respectively.

Based on risk, the fair discount rate of Vision, XOut and Zeekum is estimated to be 9.2%, 11.5%, and 9.9% per year.

Determine the Comps-price of See-It stock based on the forward-looking P/E ratio.

Provide an answer with at least 4 digits of precision.

29b) Consider the common stock of Rondo Enterprises, which earlier today reported earnings per share for the previous 12 months (also known as trailing twelve months, TTM) of $3.87 per share. The stock currently trades at $20.72 per share (which may, or may not be, the fair price of the stock). The firm does not buy back stock, nor does it plan to issue new shares in the future. You also expect that its ROE will be constant forever, at a level of 8.6% per year. You also expect the firm to continue with its previous dividend-policy in which 34% of earnings are paid out in the form of cash dividends, each year forever. Based on the risk of the stock, youve estimated the fair discount rate (i.e. the expected return), to be 9.8% per year forever. Using the TTM measure of earnings, determine the P/E ratio for the stock, if it was fairly priced. Provide an answer with at least 4 digits of precision