Google, Inc., operates the worlds largest Internet search engine. International Business Machines Corporation (IBM) is one of

Question:

Google, Inc., operates the world€™s largest Internet search engine. International Business Machines (IBM) is one of the world€™s largest computer hardware and software companies. The following data were taken from the companies€™ December 31, 2013, annual reports:

Required
a. Compute the price-earnings ratios for each company as of March 3, 2014.
b. Which company€™s future performance did the financial markets appear to be more optimistic about as of March 3, 2014?
c. Provide some reasons why the market may view one company€™s future more optimistically than the other.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...