On December 31, 2019, equity analysts following ABC Corp. are forecasting earnings per share of $1.20 for 2020 and $2.40 for 2021. The cost of equity capital is 10%. ABC Corp. does not pay dividends. ABC Corp. traded at a market price of $192 per share on December 31, 2019. Assume a constant AEG growth after 2021. What is the market's forecast of EPS for 2022?

Answer rating: 100% (QA)

The markets forecast of EPS for 2022 for ABC Corp would be 34752 based on the constant growth model and the information provided Heres how we can calculate it Gordon Growth Model GGM We can use the Go... View the full answer