3. Consider the following data on company Thor.

BV = Book value per share 5.10

ROE = Return on equity 18.5%

MP = Market price per share 26.29

Normal growth in EPS of 3.5%.

Required return on company Thor of 5.7%

EPS = Earnings per share 2.75

DPS = Dividends per share 1.25 (this is last year dividend or D₀ )

3A. Calculate the price to book value P/B based on the fair value estimation model.

Would you buy or sell company Thor based on your calculation in 3A. Explain.