Please explain why your answer is correct to each part? Thank you so much!

Part A. Which of Silveiras statements concerning the use of the P/S is correct? Statement 1 only Statement 2 only Both Statement 1 and Statement 2

Part B. Which of Silveiras statements concerning the Fed and Yardeni models is correct? Statement 3 only Statement 4 only Both Statement 3 and Statement 4

Part C. Which of Silveiras statements concerning momentum indicators is correct? Statement 5 only Statement 6 only Both Statement 5 and Statement 6

Ctia Pinho is a supervisor in the equity research division of Suite Securities. Pinho asks Flvia Silveira, a junior analyst, to complete an analysis of Adesivo S.A., Enviado S.A., and Gesticular S.A. Pinho directs Silveira to use a valuation metric that would allow for a meaningful ranking of relative value of the three companies' shares. Exhibit 1 provides selected financial information for the three companies. Exhibit 1 Selected Financial Information for Adesivo, Enviado, and Gesticular (Brazilian Real, R$ ) Silveira reviews underlying trailing EPS for Adesivo. Adesivo has basic trailing EPS of R$0.84. Silveira finds the following note in Adesivo's financial statements: "On a per share basis, Adesivo incurred in the last four quarters i. from a lawsuit, a non-recurring gain of R$0.04; and ii. from factory integration, a non-recurring cost of R$0.03 and a recurring cost of R$0.01 in increased depreciation." Silveira notes that Adesivo is forecasted to pay semiannual dividends of R$0.24 next year. Silveira estimates five-year earnings growth rates for the three companies, which are presented in Exhibit 2. Exhibit 2 Earnings Growth Rate Estimates over Five Years Pinho asks Silveira about the possible use of the price-to-sales ratio (P/S) in assessing the relative value of the three companies. Silveira tells Pinho: Statement 1: The P/S is not affected by revenue recognition practices. Statement 2: The P/S is less subject to distortion from expense accounting than is the P/E. Pinho asks Silveira about using the Fed and Yardeni models to assess the value of the equity market. Silveira states: The Fed model concludes that the market is undervalued when the market's current earnings yield is greater than the 10-year Statement 3: Treasury bond yield. Statement 2: The P/S is less subject to distortion from expense accounting than is the P/E. Pinho asks Silveira about using the Fed and Yardeni models to assess the value of the equity market. Silveira states: The Fed model concludes that the market is undervalued when the market's current earnings yield is greater than the 10-year Statement 3: Treasury bond yield. The Yardeni model includes the consensus five-year earnings Statement 4: growth rate forecast for the market index. Silveira also analyzes the three companies using the enterprising value (EV)-to-EBITDA multiple. Silveira notes that the EBITDA for Gesticular for the most recent year is R$560 million and gathers other selected information on Gesticular, which is presented in Exhibit 4. Exhibit 4. Selected Information on Gesticular at Year-End (R \$ millions) Pinho asks Silveira about the use of momentum indicators in assessing the shares of the three companies. Silveira states: Relative-strength indicators compare an equity's performance during a period with the performance of some group of equities or its own past performance. Statement 5: In the calculation of standardized unexpected earnings (SUE), the magnitude of unexpected earnings is typically scaled by the Statement 6: standard deviation of analysts' earnings forecasts