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plsease answer questions 2. A & B please!!! :) Here is some recent financial data for a number of companies. Net Income and of shares

plsease answer questions 2. A & B please!!! :) image text in transcribed

Here is some recent financial data for a number of companies. Net Income and of shares outstanding are in thousands. Annual Net Income shares outstanding Stock price per share L Brands (LB) 292,350 $903,000 $89.92 82,390 $100.55 $145,537 PVH (PVH) $105.30 $776,000 Ralph Lauren (RL) 87,950 $1,280,000 $30.47 The Gap (GPS) 434,860 2) As you answer these questions keep in mind that stock value (price) can be thought of as a function of profit, growth opportunities and risk. Your answers should identify which of those 3 factors seems prominent in the determination of the price of a stock. When I ask "how can you tell" l am looking for you to identify a piece of data on which you have based your answer. All of these can be answered in a few lines. a) Look at Ralph Lauren and PVH. What is it that makes Ralph Lauren stock sell at over $105 a share while PVH sells for over $100 a share? Is it profit? Growth potential? Risk? How can you tell? b) Look at L Brands and The Gap s it profit, growth potential or risk that is the main reason why a share of L Brands stock costs about $90 while The Gap stock is worth $30 a share? How can you tell

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