Question
In a memo to the Chief Executive Officer, answer the following questions, which are pre-loaded in your Memo Template: STARBUCKS VS DUNKIN DONUTS The P/E
In a memo to the Chief Executive Officer, answer the following questions, which are pre-loaded in your Memo Template:
STARBUCKS VS DUNKIN DONUTS
The P/E ratio helps investors determine the market value of a stock as compared to the company's earnings. A high P/E could mean that a stock's price is high relative to earnings and possibly overvalued. Conversely, a low P/E might indicate that the current stock price is low relative to earnings.
Which company, as compared to its industry, is overvalued, undervalued, or perfectly priced? What data, reference, or ratios drew you to that conclusion?
Based on the YoY annual growth rates of revenue % and net income %, which company is growing its top line and bottom line faster? What data, reference, or ratios drew you to that conclusion?
Which of the two companies is the better run company? (Keep in mind that you will get posed this question for the next several weeks. Keep track of how you grow from this week to the next week with your response.)
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