CalCPA ndow Help Homework 1 Questions FIN 350 Summer 2018pd

? CalCPA ndow Help Homework 1 Questions FIN 350 Summer 2018.pdf (page 4 of 4) QSearch The sleeping Flower Co. has earning of $2.65 per share. The benchmark PE for the company is 18. What stock price would you consider appropriate? What is the benchmark PE were 21? 4· Section 6 MacBook Air 40 F7 FS

Solution

Answer

Earning per share EPS = $2.65

PE ratio stands for price earning ratio = MPS/EPS

Therefore 18 = mps/2.65

Therefore MPS = 18*2.65 = 47. 70 $

The stock price that consider appropriate is 47.70$

And if the benchmark PE is 21 then the stock price or price of share

= 21*2.65 = 55.6 5$ answer