Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Abbott Laboratories (ABT) engages in the discovery, development, manufacture, and sale of a line of health care and pharmaceutical products. Below you will find selected

Abbott Laboratories (ABT) engages in the discovery, development, manufacture, and sale of a line of health care and pharmaceutical products. Below you will find selected information from Value Line. Use the Value Line estimated 2012 figures as the actual year-end figures for the company. The beta reported was .6 and the risk-free rate was 3.21 percent. Assume a market risk premium of 6 percent.

The high and low share price each year were:

2008 2009 2010 2011 2012
High $ 78 $ 57.9 $ 60.3 $ 64.3 $ 57.4
Low 66.5 45.7 44.8 45.8 43.7

Using the P/E, P/CF, and P/S ratios, estimate the 2013 share price for Abbott Laboratories. Use the average stock price each year to calculate the price ratios. (Do not round intermediate calculations. Round your answers to 2 decimal places. Omit the "$" sign in your response.)

Price ratio
P/E $
P/CF $
P/S $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Bakers Health Care Finance Basic Tools For Nonfinancial Managers

Authors: Thomas K. Ross

6th Edition

1284233162, 978-1284233162

More Books

Students also viewed these Finance questions

Question

analyze file formats and basic digital design rules.

Answered: 1 week ago