Question
Beagle Beauties engages in the development, manufacture, and sale of a line of cosmetics designed to make your dog look glamorous. Below you will find
Beagle Beauties engages in the development, manufacture, and sale of a line of cosmetics designed to make your dog look glamorous. Below you will find selected information necessary to compute some valuation estimates for the firm. Assume the values provided are from year-end 2019. Also assume that the firms equity beta is 1.30, the risk-free rate is 2.55 percent, and the market risk premium is 8.0 percent.
Dividends per share | $ | 2.42 | |
Return on equity | 10.50 | % | |
Book value per share | $ | 19.90 | |
Earnings | Cash Flow | Sales | ||||||||
2019 value per share | $ | 5.00 | $ | 6.40 | $ | 25.65 | ||||
Average price multiple | 13.10 | 9.61 | 2.55 | |||||||
Forecasted growth rate | 13.67 | % | 11.22 | % | 7.25 | % | ||||
Using the PE, P/CF, and P/S ratios, estimate the 2020 share price for Beagle Beauties. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Using PE ratio
Using P/CF ratio
Using P/S ratio
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