a. What is your high target stock price over the next year? b. What is your low target stock price over the next year? a. High target stock price b. Low target stock price

International Financial Management
14th Edition
ISBN:9780357130698
Author:Madura
Publisher:Madura
Chapter13: Direct Foreign Investment
Section: Chapter Questions
Problem 1IEE
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you look at stock prices over any year, you will find a high and low stock price for the year. Instead of a single benchmark PE ratio,
we now have a high and a low stock price for the next year. Suppose we have the following information on a particular company over
the past four years.
High price
Low price
EPS
Year 1 Year 2 Year 3
$29.43 $28.32 $32.42
21.86 22.18 27.65
1.75
1.88
2.01
Earnings are projected to grow at 9% over the next year. (Do not round intermediate calculations and round your answer to 2
decimal places, e.g., 32.16.)
a.
b.
Year 4
$39.01
28.41
2.35
a. What is your high target stock price over the next year?
b. What is your low target stock price over the next year?
High target stock price
Low target stock price
Transcribed Image Text:you look at stock prices over any year, you will find a high and low stock price for the year. Instead of a single benchmark PE ratio, we now have a high and a low stock price for the next year. Suppose we have the following information on a particular company over the past four years. High price Low price EPS Year 1 Year 2 Year 3 $29.43 $28.32 $32.42 21.86 22.18 27.65 1.75 1.88 2.01 Earnings are projected to grow at 9% over the next year. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. b. Year 4 $39.01 28.41 2.35 a. What is your high target stock price over the next year? b. What is your low target stock price over the next year? High target stock price Low target stock price
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