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You are considering purchasing stock in a small illiquid enterprise. The most recent net income for the firm was $13,567,000, and there are 568,000 shares
You are considering purchasing stock in a small illiquid enterprise. The most recent net income for the firm was $13,567,000, and there are 568,000 shares outstanding. To make your valuation estimate you will calculate the P/E Ratio for a comparable, publically traded company. The shares of that firm are selling for $42.72. Its most recent net income was $25,950,000 and there are 5,550,000 shares outstanding. Based on this comparable P/E Ratio, how much should you be willing to pay for the shares of your firm of interest?
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