Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Firm A's EPS is $3.00. You have found its closest competitor's trading at a P/E of 30. Assume both... 1. Firm A's EPS Is $3.00.

Firm A's EPS is $3.00. You have found its closest competitor's trading at a P/E of 30. Assume both...image text in transcribed

1. Firm A's EPS Is $3.00. You have found its closest competitor's trading at a P/E Of 30 Assume The both have a similar operating and financial profile. Il firm A's stock price is $40.00 What is its value relative to its competitor? 2. Assume you are at the beginning of December 2019. The stock price of firm A is $20 and EPS Q1, Q2. Q3, and Q4 are 0.18, 0.25. 0.32 and 0.35. The fiscal year forecast for 2019 is $1.1. EPS Q1, Q2, Q3 and Q4 are 0.43.0.48.0.50, 0.59. The fiscal year forecast for 2020 is $2.00. Calculate forward P/E on EPS for the next twelve months' approach. 3. The firm, you are following, has a stock price of $40.00, EPS of S3.00, a dividend of $1.80, book value per share of 5.00, sales per share of 15.00. ROE of 20.00% and required return on cquity is 10.00%. Calculate the actual and justified P/Sales ratio and comment on your findings. 4. Find the normalized earnings and price to earnings ratio Year 2019 2018 2017 2016 2015 EPS $0.66 $0.55 $0.81 $0.73 $0.34 BVPS $4.11 $3.67 $2.98 $2.12 $1.61 ROE 16.1% 15.0% 27.2% 34.4% 21.1% 2020 stock price $24,00

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

Step: 3

blur-text-image

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

International Project Finance

Authors: Felix I. Lessambo

1st Edition

3030963896, 978-3030963897

More Books

Students also viewed these Finance questions

Question

Employ effective vocal cues Employ effective visual cues

Answered: 1 week ago