15. 30 stock analysts submitted 2020 Earnings Per Share estimates for Microsoft Corporation (Ticker: MSFT), and...

 

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15. 30 stock analysts submitted 2020 Earnings Per Share estimates for Microsoft Corporation (Ticker: MSFT), and the summary statistics of the EPS estimates are presented in the table below: Average Estimate Low Estimate High Estimate 2020 Earnings Per Share $5.00 $4.25 $5.76 According to Bloomberg, the 5-Year Historical Earnings Multiplier (i.e. P/E ratios) have been: P/E Current 27.5x 26.1x 11.7x High Low Using the information given above, estimate Microsoft's Intrinsic Value. [20 points] [HINT: Remember the comment I made in class that you should always DO THIS TYPE OF ANALYSIS because "you should never make a decision on the basis of a..."] Discuss your findings. 15. 30 stock analysts submitted 2020 Earnings Per Share estimates for Microsoft Corporation (Ticker: MSFT), and the summary statistics of the EPS estimates are presented in the table below: Average Estimate Low Estimate High Estimate 2020 Earnings Per Share $5.00 $4.25 $5.76 According to Bloomberg, the 5-Year Historical Earnings Multiplier (i.e. P/E ratios) have been: P/E Current 27.5x 26.1x 11.7x High Low Using the information given above, estimate Microsoft's Intrinsic Value. [20 points] [HINT: Remember the comment I made in class that you should always DO THIS TYPE OF ANALYSIS because "you should never make a decision on the basis of a..."] Discuss your findings.

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