Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Name P/E Company A 7.36 18.09 Company B Company C 9.76 Company D 14.89 Company E 6.55 The table above shows price to earnings (P/E)

image text in transcribed

Name P/E Company A 7.36 18.09 Company B Company C 9.76 Company D 14.89 Company E 6.55 The table above shows price to earnings (P/E) multiples for firms in the retail industry. Another retail firm, Company X (not shown), expects earnings per share of $3.59 and EBITDA of $336 million. Company X has no excess cash, $67 million of debt, and 108 million shares outstanding. Using the average price to earnings multiple for comparable businesses, what is the best estimate of the stock price of Company X? Round your answer to two decimal places, and omit dollar signs (i.e., enter $2,001.271 as 2,001.27)

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

Financial Literacy And Money Script A Caribbean Perspective

Authors: Christine Sahadeo

1st Edition

3319770748, 978-3319770741

More Books

Students also viewed these Finance questions