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Pacific Storage expects to have earnings per share of $5.25 in 2010 and $5.65 in 2011. The average price-earnings ratio for the industry is 10X
Pacific Storage expects to have earnings per share of $5.25 in 2010 and $5.65 in 2011. The average price-earnings ratio for the industry is 10X (times). Pacific Storage has traditionally had a P/E ratio 12% higher than the industry and in 2010 it is expected to be 15% higher than the industry. Calculate the expected price of Pacific's stock in 2010 and 2011 based on expectations of EPS and P/E ratios.
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