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You have the following information available to you about an investment you are pondering in Star Corp (Star) stock: The stock's PE ratio is currently
You have the following information available to you about an investment you are pondering in Star Corp (Star) stock: The stock's PE ratio is currently 20, and you expect it to stay at this level for the next several years. Star's net profit margin is expected to be 20% in two years. Star's earnings per share is expected to be $1.50 in two years. Star's beta is 2.2, and its required return is 14.5%. Based only on this information, what is your best estimate of the value of Star stock at the end of two years? (Hint: This is not complex.)
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