Energy Resources generated an EPS of $3.89 over the last 12 months. The company's earnings are...

 

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Energy Resources generated an EPS of $3.89 over the last 12 months. The company's earnings are expected to grow by 18.2% next year, and because there will be no significant change in the number of shares outstanding, EPS should grow at about the same rate. You feel the stock should trade at a P/E of around 27 times earnings. Use the P/E approach to set a value on this stock. Using the P/E approach, the value on this stock is $ (Round to the nearest cent.) Energy Resources generated an EPS of $3.89 over the last 12 months. The company's earnings are expected to grow by 18.2% next year, and because there will be no significant change in the number of shares outstanding, EPS should grow at about the same rate. You feel the stock should trade at a P/E of around 27 times earnings. Use the P/E approach to set a value on this stock. Using the P/E approach, the value on this stock is $ (Round to the nearest cent.)

Answer rating: 100% (QA)

To calculate the value of the stock using the PE approach we need to m... View the full answer