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Question 1: Suppose that the average forward 12-month P/E ratio in the banking industry is 12.5. Assume Bank of America is expected to have an

Question 1: Suppose that the average forward 12-month P/E ratio in the banking industry is 12.5. Assume Bank of America is expected to have an EPS of $3.2 in 2024. Suppose the P/E ratio of Bank of America is comparable to the industry average. What is the intrinsic of the Bank of America by the end of 2023?

Question 2: Suppose that the average trailing 12-month P/E ratio of Starbucks is 30. Assume Starbucks EPS of the past 12 months is $3.8. Using price multiple valuation, what is the intrinsic value of Starbucks?

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