Problem 410 MB and Share Price You are given the following i

Problem 4-10 M/B and Share Price You are given the following information: Stockholders equity = $5.75 billion, price/earnings ratio common stock. Round your answer to the nearest cent. 22, common shares outstanding = 52 million, and market/book ratio = 1.3 Calculate the price of a share of the company\'s

Solution

Book value per share = Stockholders equity / common shares outstanding

Book value per share = 5,750,000,000 / 52,000,000

Book value per share = 110.5769

Price of share = Book value * market/book ratio

Price of share = 110.5769 * 1.8

Price of share = $199.0