Question: please help i am stuck, need help question 1 a-c Styles 1) This question asks you to estimate the value of one share of stock

please help i am stuck, need help question 1 a-c

Styles 1) This question asks you to estimate the value of one share of stock in a company that has the following characteristics: Sustainable ROE: Cost of Equity: Sustainable Growth Rate: Book Value Per Share: 6.50% 6.25% 2.00% $40.80 a) How much should we be willing to pay for 1 share of stock in the company above, and what P/E and P/B ratios do your estimates imply? b) How would your estimate for the value of this stock change if this company is able to increase its sustainable ROE to 7.5% without altering its cost of equity? Note your new estimate here and explain how altering this assumption affected the P/E and P/B Ratios that it implies. Why has your estimate for this company changed? c) Should we be willing to buy this stock at a price of $42 today? Why or why not

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