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A stock analyst uses multiples to value a stock. The stock has earnings per share of $4.00 share. The stock has sales revenue per share
A stock analyst uses "multiples" to value a stock.
The stock has earnings per share of $4.00 share.
The stock has sales revenue per share of $40/share.
The benchmark PE ratio is 18.
The analyst finds the same stock price using the price-sales ratio multiple as the analyst finds using the PE ratio multiple.
What is the benchmark price-sales ratio multiple the analyst used?
a) | 10 | |
b) | 72 | |
c) | 1.8 | |
d) | 4.5 |
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