. The P/E ratio is 8 . The D/E is 90/10, the tax rate is .20 and the unlevered beta is 3 . The net profit margin is .09. Total assets are $100 million and total sales are $60 million. The outstanding shares are 100,000. Derive the price of the stock for next year. What issues do we need to address with the EPS? Address revenue and expense recognition as well as financial leverage. Talk on the immutability of P/E ratios