During 2012, Beta, Inc , had sales of $6 86 billion, operating profit of $2 20 billion, and net income of $3 40 billion EPS was $4 80 On May 11, 2013, one share of Betas common stock was priced at $54 30 on the New York Stock Exchange What investment capitalization rate did investors appear to be u...

Estimated EPS for value of contin ...

During 2012, Beta, Inc., had sales of $6.86 billion, operating profit of $2.20 billion, and net income

Question:

During 2012, Beta, Inc., had sales of $6.86 billion, operating profit of $2.20 billion, and net income of $3.40 billion.
EPS was $4.80. On May 11, 2013, one share of Beta’s was priced at $54.30 on the New York Stock Exchange.
What investment capitalization rate did investors appear to be using to determine the value of one share of Beta stock? The formula for the value of one share of stock uses EPS in the calculation.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...