Question
You are valuing one share of a bank using valuation by comparables. You selected four similar banks, calculated their PE ratios and reported them in
You are valuing one share of a bank using valuation by comparables. You selected four similar banks, calculated their PE ratios and reported them in the table below. What is the value of one share of your bank if the bank generates $5.0 of earnings per share? (Enter your answer in dollars with 2 decimal places.)
| Bank | P/E Ratio |
| Wells Fargo | 95.6 |
| Citigroup | 15.4 |
| Bank of America | 20.8 |
| JP Morgan Chase | 17.2 |
Step by Step Solution
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Valuation by comparables uses the PE ratio to infer the fair value of a company based on t...
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Financial Reporting Financial Statement Analysis And Valuation A Strategic Perspective
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
9th Edition
1337614689, 1337614688, 9781337668262, 978-1337614689
