Question: Based on the data from the table, what if company A surprised the market and reported EPS of $4 per share and its projected
Based on the data from the table, what if company A surprised the market and reported EPS of $4 per share and its projected P/E went down to 18. Assuming its current price did not change, would it be undervalued or overvalued and by approximately what percentage? 8% undervalued 2% undervalued 10% overvalued Company A B C D Estimated P/E Ratio 20 30 40 25 Estimated Annual EPS 5 3 3 4 Current Price $80 $80 $150 $100 Percent overvalued or undervalued?
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