You are considering investing in Henderson Engineers Ltd. The book value of shareholders' equity is $40,0000, 000. The firm has made a net profit of $ 660,000 for the year ending 30 June 2023. The earnings per share is $1.30. You also find the PE ratio for firms similar to Henderson is 12. a) What is the book value per share for Henderson Engineers Ltd? b) What price would you expect Henderson shares to sell for? c) Explain would you invest in this share and why.

You are considering investing in Henderson Engineers Ltd. The book value of shareholders' equity is $40,0000, 000. The firm has made a net profit of $ 660,000 for the year ending 30 June 2023. The earnings per share is $1.30. You also find the PE ratio for firms similar to Henderson is 12. a) What is the book value per share for Henderson Engineers Ltd? b) What price would you expect Henderson shares to sell for? c) Explain would you invest in this share and why.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter18: Initial Public Offerings, Investment Banking, And Capital Formation

Section: Chapter Questions

Problem 9MC

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