Question
If you look at stock prices over any year, you will find a high and low stock price for the year. Instead of a single
If you look at stock prices over any year, you will find a high and low stock price for the year. Instead of a single benchmark PE ratio, we now have a high and low PE ratio for each year. We can use these ratios to calculate a high and a low stock price for the next year. Suppose we have the following information on a particular company:
Year 1: High Price - 85.61 Low Price - 68.33 EPS - 6.46
Year 2: High Price - 94.99 Low Price - 79.75 EPS - 8.88
Year 3: High Price - 116.05 Low Price - 84.23 EPS - 8.54
Year 4: High Price - 128.08 Low Price - 105.86 EPS - 10.13
A) High Target Price = B) Low Target Price = | ||||||||
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