Calculate an estimated value of a share of the stock using multiples. Use the Forward P/E as
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For example, suppose the Forward P/E is 27 and there are Consensus Estimates of $2.06 in 2021E and $2.25 in 2022E. According to the model, P1 would be $55.62 and P2 would be equal to $60.75. As described in the text, forecasted prices such as these are called Target Prices.
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Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
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