Cranesville Inc is a energy firm which specializes in extraction of oil & gas. Assume today is
Question:
Cranesville Inc is a energy firm which specializes in extraction of oil & gas. Assume today is December 31, 2019 and you are asked to determine whether Cranesville stock is a good deal. Selected financial information for Cranesville is shown in Exhibit 1. All numbers for Cranesville are aggregate and in millions, except for earnings per share. Cranesville currently has 2 million shares outstanding.
Cranesville has a single comparable firm which is Brooksfield Inc. Both firms have December fiscal year ends and are highly similar in many operational aspects. Selected financial information for Brooksfield is shown in Exhibit 2. All numbers for Brooksfield are aggregate and in millions, except for earnings per share. Brooksfield has 4 million shares outstanding and is currently trading at a price of $50 per share.
A. Based on the information what is the implied PRICE PER SHARE (to the nearest cent) for Cranesville using the LEADING P/E MULTIPLE?
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw