Gloria Enterprises plans to go public with a public offering. Management would like to determine the potential price for its shares of common stock based on comparable price-earnings multiples. Gloria Enterprises reports earnings of $208,000 and plans to issue 80,000 shares of stock. The EPS and share price of three comparable firms are shown below: Firm EPS Share Price A $2.50 $ 89.20 В 3.60 119.70 2.00 83.54 Calculate the value of a share of Gloria Enterprises' stock using the price-earnings multiples method for both a trailing multiple and a forward multiple.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Gloria Enterprises plans to go public with a public offering. Management would like to determine
the potential price for its shares of common stock based on comparable price-earnings multiples.
Gloria Enterprises reports earnings of $208,000 and plans to issue 80,000 shares of stock. The
EPS and share price of three comparable firms are shown below:
Firm
EPS
Share Price
A
$2.50
$ 89.20
В
3.60
119.70
2.00
83.54
Calculate the value of a share of Gloria Enterprises' stock using the price-earnings multiples
method for both a trailing multiple and a forward multiple.
Transcribed Image Text:Gloria Enterprises plans to go public with a public offering. Management would like to determine the potential price for its shares of common stock based on comparable price-earnings multiples. Gloria Enterprises reports earnings of $208,000 and plans to issue 80,000 shares of stock. The EPS and share price of three comparable firms are shown below: Firm EPS Share Price A $2.50 $ 89.20 В 3.60 119.70 2.00 83.54 Calculate the value of a share of Gloria Enterprises' stock using the price-earnings multiples method for both a trailing multiple and a forward multiple.
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