Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Our Space is a social media site that is growing in popularity. The firm has been around for a few years and has created a

image text in transcribed

Our Space is a social media site that is growing in popularity. The firm has been around for a few years and has created a nice market niche for itself. In fact, it actually turned a profit last year, albeit a fairly small one. After doing some basic research on the company, you've decided to take a closer look. You plan to use the price-to-sales ratio to value the stock, and you have collected P/S multiples on the following social media companies: B. Find the average P/S ratio for these three firms. Given that Our Space is expected to generate $45 million in sales next year and will have 16 million shares of stock outstanding, use the average P/S ratio you computed above to put a value on Our Space's stock. The average P/S ratio for the 3 firms is x. (Round to two decimal places.) The value of Our Space's stock is $ x. (Round to the nearest cent.) i X Data Table in order to copy the contents of the data table below (Click on the icon here into a spreadsheet.) Company Facebook Snap Twitter P/S Multiples 13.01 17.85 12.88

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

Foundations In Personal Finance

Authors: Dave Ramsey

1st Edition

0981683967, 978-0981683966

More Books

Students also viewed these Finance questions