Question: Given the following data for a hypothetical corporation & its stock. 2020 ACTUAL 2021 FORECAST SALES $375 million DECLINE OF 2% FROM 2020 NET PROFIT

Given the following data for a hypothetical corporation & its stock.

2020 ACTUAL

2021 FORECAST

SALES

$375 million

DECLINE OF 2% FROM 2020

NET PROFIT MARGIN

5.5%

5.4%

NUMBER SHARES O/S (MILLIONS)

15.3

15.5

P/E RATIO

25.0 x

25.0 x

Rate of return stockholders require is 11.5%

Determine this stocks intrinsic value (P0). Show all formulas & calculations.

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