Question: Question: 1. Given the portfolio data on Blackboard, with 5 years and 10 firms ranked by PE in 2008, you are required to perform stock

 Question: 1. Given the portfolio data on Blackboard, with 5 years
and 10 firms ranked by PE in 2008, you are required to
perform stock valuation methods to analyze individual stock. With five years of
financial fundamentals for each firm, you will need to first determine the
predicted value of each firm: Question A: Apply P/E ratio and P/Book

Question: 1. Given the portfolio data on Blackboard, with 5 years and 10 firms ranked by PE in 2008, you are required to perform stock valuation methods to analyze individual stock. With five years of financial fundamentals for each firm, you will need to first determine the predicted value of each firm: Question A: Apply P/E ratio and P/Book value ratio analysis to predict the expected values for 10 firms and identify firms which are undervalued and which are overvalued. (Hint: Use P/E and P/B average ratio and growth rates of earnings and book value and use 1/1/2013 stock price as current price to determine undervalued/overvalued) Question B: With both methods used above, determine and screen over the final selected 7 firms into your portfolio. The final firms are determined BOTH undervalued by both P/E and P/B methods, B D G Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share - Pay Date Price Close 1 Date -- Fiscal ol Company Name Cash Outstanding (Loss Parent - Fiscal Annual - Fiscal 2E07 2008 MAPL APPLE INC 11875 888.326 4834 21030 O 113.66 1 2E07 2009 AAPL APPLE INC 5263 899.806 8235 31640 0 185.35 2E407 2010 AAPL APPLE INC 11261 -915.97 14013 47791 0 283.75 S 2E07 2011 AAP APPLE INC 9815 929.277 25922 76615 0 381.32 6 2E07 2012. AAPL APPLE INC 10746 939.208 41733 118210 2.65 667. 105 7 2E402 2008 FORD MOTOR CO 22049 2396.321 -14672 - 17311 0 2:29 8 2E407 2009 FORD MOTOR CO 21441 3368.266 2717 -7820 0 10 26+07 2010 F FORD MOTOR CO 14805 3782.711 6561 -673 0 16.79 10 2E07 2011 FORD MOTOR CO 17148 3800.747 20213 15028 0 10.76 11 2E07 2012 F FORD MOTOR CO 15659 3922.248 5665 15947 0.2 12.95 12 2E07 2008 GE GENERAL ELECTRIC CO 48187 10536,897 17010 104665 1.24 16.2 2E07 2009 GE GENERAL ELECTRIC CO 72260 10563.075 11025 127291 0.82 15.13 16 2E402 2010 GE GENERAL ELECTRIC CO 78958 10615.376 11644 118936 0.42 18.29 2E02 2011 GE GENERAL ELECTRIC CO BA501 10573.017 14151 116438 0.58 17.91 16 2407 2012 GE GENERAL ELECTRICCO 77356 10405.625 13641 123026 0.68 20.99 17 2E07 2008 GM GENERAL MOTORS CO 1405) 610.483 30850 86154 3.2 18 2E07 2003 OM GENERAL MOTORS CO 22629 500 104821 28242 0 0.471 19 26-07 2010 GM GENERAL MOTORS CO 21061 1500.137 6172 36180 36.86 20 2E+02 2011 GM GENERAL MOTORSCO 15499 1564.727 9190 38120 0 2012 20:07 2012 ON GENERAL MOTORS CO 18422 1366.374 6188 36744 O 28.33 22 2007 2OOR HPG HEWLETT-PACKARD CO 10153 2415 103 8329 38942 0.32 38.28 20 2E07 200 HP HEWLETT-PACKARD CO 13229 2364.809 7660 40512 0.32 47.46 ZA 2407 2010 UPO HEWLETT-PACKARD CO 10929 2203 898 3761 40449 0.32 42.04 1 un SEWLETTPACKARDON 1990 2074 25 4 2.61 Finance Game Play 05 Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share. Pay Date Price Close. 1 Date - Fiscal ol Company Name Cash outstanding (Loss Parent - Fiscal Annual - Fiscal 21 2E407 2012 GM GENERAL MOTORS CO 18422 1366.374 6188 36244 288 22 26.07 2005 HPG HEWLETT-PACKARD CO 10153 2415.303 8329 38942 0.32 38.28 23 26.07 2009 HPG HEWLETT PACKARD CO 13279 2364,809 7660 40517 0.32 47:46 24 2402 2010 HPO HEWLETT-PACKARD CO 10029 2203.898 8761 40449 0.32 42.04 25 26.07 2011 HPG HEWLETT PACKARD CO 8043 1990.506 7074 38625 0.4 26.61 26 2E407 2012 HP HEWLETT-PACKARD CO 11301 1962.838 - 12650 22436 0.504 13.85 27 2E+07 2008 IOM INTL BUSINESS MACHINE 12741 1339.096 12334 13465 1.9 84.16 2E07 2000 IBM INTL BUSINESS MACHINE 12182 1305.337 13425 22637 2.15 130,9 2.07 2010 IBM INTL BUSINESS MACHINE 10661 1227.993 14833 23046 2.5 146.76 10 2:07 2011 IAM INTL BUSINESS MACHINE 11922 1163.183 15855 20138 2.9 183.8 31 2E407 2012 M INTL BUSINESS MACHINE 10412 1117.368 16604 18860 3.3 191.55 32 2E07 2008 BAC BANK OF AMERICA CORP 32857 5017.436 4008 177052 0.04 14.05 33 2:07 2009 BAC BANK OF AMERICA CORP 121339 8650.244 6276 231444 0.04 15.00 34 2E07 2010 BAC BANK OF AMERICA CORP 108427 10085.155 - 2238 228248 0.04 13.34 2E07 2011 BAC BANK OF AMERICA CORP 120102 10535.938 1446 230101 0.04 5.56 2+07 2012 BAC BANK OF AMERICA CORP 110752 10778.264 4188 236956 0.04 37 11.61 2E+02 2008 MSFT MICROSOFT CORP 10339 9151 17681 36286 0.43 27.51 2E07 2009 MSET MICROSOFT CORP 6076 8908 14569 39558 22.77 2002 2010 MSFT MICROSOFT CORP 5SOS 8668 18760 46175 0.52 23.01 40 2402 2011 MSFT MICROSOFT CORP 9610 8376 23150 57083 0.61 220 41 2E02 2012 MSET MICROSOFT CORP 6938 8381 16978 363 0.76 30.59 42 2E07 2008 YHOO YAHOO INC 22923 1391 56 424.298 11250.942 12.2 2407 2009 YH00 YAHOO INC 1275.43 1406.075 597.992 12493.32 16.78 30 31 VHO VALDOING 1526 41 130 3 121 1755R 139 Finance Game Play 166 0.5 Clipboard Font Alignment Number Styles Cells N15 0.00 2007 c D Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share. Pay Date Price Close. 1 Date - Fiscal - - Company Name Cash Outstanding (Loss Parent - Fiscal Annual - Fiscal 2 2E402 2010 M INTL BUSINESS MACHINE 10661 1227.993 14833 23046 2.5 146.76 10 2E07 2011 IBM INTL BUSINESS MACHINE 11922 116.183 15855 20138 2.9 181,4H 91 2007 2012 AM INTL BUSINESS MACHINE 10412 117 368 16604 18860 13 191.55 2407 2008 BAC BANK OF AMERICA CORP 32857 5017436 4008 177052 14.00 11 26.07 2009 BAC IMNK OF AMERICA CORP 121339 8650.244 6276 231444 0.04 15.06 2007 2010 AM BANK OF AMERICA CORP 101427 10085.155 223 228248 0.04 14 2011 BAC BANK OF AMERICA CORP 120102 10535.938 1446 230101 0.04 5.56 10 2407 2012 BAC BANK OF AMERICA CORP 110752 10778264 4118 236956 0.04 11,61 37 26:07 2008 MSFT MICROSOFT CORP 10339 9151 17681 3626 0.43 27.51 38 2E407 2009 MUIT MICROSOFT CORP 0076 BON 14569 39558 0.5 23.72 19 2E07 2010 MSFT MICROSOFT CORP 5505 1668 18760 46175 0.52 2101 2:07 2011 MSFT MICROSOFT CORP 9610 8376 23150 52083 0.61 26 2407 2012 MSET MICROSOFT CORP 6338 8381 1678 66.363 6.76 30.59 26.07 2001 VHOO YAHOO INC 22923 1.991.56 424,29 11250,942 O 12.2 43 2:07 2009 YHOO YAHOO INC 1275.43 1406.075 597.992 12493.32 D 16.78 44 2:02 2010 VHOD YAHOO INC 1526.41 1308.836 1231.663 12558.129 0 16.63 45 2.02 2011 YHOO YAHOO INC 156239 1190.006 1048 827 12541067 16.13 21:07 2012 YOO YAHOO INC 2067.78 1115.233 1145.429 14560.2 199 2E+07 2008 GOOG GOOGLE INC 3656.67 315.114 4226.58 28238862 7.65 2E07 2009 GOOG GOOGLE INC 101916 317.772 6520.448 36004.224 $19.98 2-01 2010 GOOD GOOGLE INC 1:3630 121.300 8505 46241 59307 50 21407 2011 GOOGLE INC 9983 324 295 9737 58145 51 2E07 2012 GOOG GOOGLE INC 16778 329.979 10732 71715 707. Finance Game Play OOOOOOO B Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share - Pay Date Price Close. 1 Date - Fiscal ol Company Name Cash Outstanding (Loss Parent - Fiscal Annual - Fiscal 29 2E07 2010 IBM INTL BUSINESS MACHINE 10661 1227.993 14833 23046 2.5 146.76 30 ZE+02 2011 IBM INTL BUSINESS MACHINE 11922 1163.183 15855 20138 2.9 183 88 31 2E07 2012 IBM INTL BUSINESS MACHINE 10412 1117.368 16604 18860 3.3 191 55 32 2.07 2008 BAC BANK OF AMERICA CORP 32857 5012.436 4008 177052 0.04 14,08 33 2407 2009 BAC BANK OF AMERICA CORP 121339 8650.244 6276 231444 0.04 15.06 34 20:07 2010 BAC BANK OF AMERICA CORP 108427 10085.155 -2238 228248 0,04 13.14 35 2E+07 2011 BAC BANK OF AMERICA CORP 120102 10535.938 1446 230101 0.04 5.56 36 2E407 2012 BAC BANK OF AMERICA CORP 110752 10778.264 4188 236956 0.04 11.61 37 2E07 2008 MSFT MICROSOFT CORP 10339 9151 17681 36286 0.43 27.51 38 2E+07 2009 MSFT MICROSOFT CORP 6076 8908 14569 39558 0.5 23.77 39 2E+07 2010 MSFT MICROSOFT CORP 5505 8668 18760 46175 0.52 23.01 00 20+07 2011 MSFT MICROSOFT CORP 9610 8376 23150 57083 0.61 26 41 2E407 2012 MSFT MICROSOFT CORP 6938 8381 16978 66363 0.76 30.59 42 2E+07 2008 YHOO YAHOO INC 22923 1391 56 424.298 11250.942 0 12.2 2E+07 2009 YHOO YAHOO INC 1275.43 1406.075 597.992 12493.32 0 16.78 44 2E07 2010 YHDO YAHOO INC 1526.43 1308.836 1231.663 12558.129 0 16.63 15 20+07 2011 YHOO YAHOO INC 156239 1190.006 1048.827 12541.067 0 16.13 45 2E+07 2012 YHOO YAHOO INC 2667.78 1115.233 3945.479 14560.2 19.9 47 2E+07 2008 GOOG GOOGLE INC 8656.62 315.114 4226.858 28238.862 307.65 49 2E07 2009 GOOG GOOGLE INC 101976 317.722 6520.448 36004.224 619.98 49 2E07 2010 GOOG GOOGLE INC 13630 321.301 BSOS 46241 593.92 50 2E407 2011 GOOG GOOGLE INC 9983 324895 9737 58145 645.9 51 2E+07 2012.GOOG GOOGLE INC 14778 329.979 10737 71715 707.38 OOOOOO B- Finance Game Play Question: 1. Given the portfolio data on Blackboard, with 5 years and 10 firms ranked by PE in 2008, you are required to perform stock valuation methods to analyze individual stock. With five years of financial fundamentals for each firm, you will need to first determine the predicted value of each firm: Question A: Apply P/E ratio and P/Book value ratio analysis to predict the expected values for 10 firms and identify firms which are undervalued and which are overvalued. (Hint: Use P/E and P/B average ratio and growth rates of earnings and book value and use 1/1/2013 stock price as current price to determine undervalued/overvalued) Question B: With both methods used above, determine and screen over the final selected 7 firms into your portfolio. The final firms are determined BOTH undervalued by both P/E and P/B methods, B D G Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share - Pay Date Price Close 1 Date -- Fiscal ol Company Name Cash Outstanding (Loss Parent - Fiscal Annual - Fiscal 2E07 2008 MAPL APPLE INC 11875 888.326 4834 21030 O 113.66 1 2E07 2009 AAPL APPLE INC 5263 899.806 8235 31640 0 185.35 2E407 2010 AAPL APPLE INC 11261 -915.97 14013 47791 0 283.75 S 2E07 2011 AAP APPLE INC 9815 929.277 25922 76615 0 381.32 6 2E07 2012. AAPL APPLE INC 10746 939.208 41733 118210 2.65 667. 105 7 2E402 2008 FORD MOTOR CO 22049 2396.321 -14672 - 17311 0 2:29 8 2E407 2009 FORD MOTOR CO 21441 3368.266 2717 -7820 0 10 26+07 2010 F FORD MOTOR CO 14805 3782.711 6561 -673 0 16.79 10 2E07 2011 FORD MOTOR CO 17148 3800.747 20213 15028 0 10.76 11 2E07 2012 F FORD MOTOR CO 15659 3922.248 5665 15947 0.2 12.95 12 2E07 2008 GE GENERAL ELECTRIC CO 48187 10536,897 17010 104665 1.24 16.2 2E07 2009 GE GENERAL ELECTRIC CO 72260 10563.075 11025 127291 0.82 15.13 16 2E402 2010 GE GENERAL ELECTRIC CO 78958 10615.376 11644 118936 0.42 18.29 2E02 2011 GE GENERAL ELECTRIC CO BA501 10573.017 14151 116438 0.58 17.91 16 2407 2012 GE GENERAL ELECTRICCO 77356 10405.625 13641 123026 0.68 20.99 17 2E07 2008 GM GENERAL MOTORS CO 1405) 610.483 30850 86154 3.2 18 2E07 2003 OM GENERAL MOTORS CO 22629 500 104821 28242 0 0.471 19 26-07 2010 GM GENERAL MOTORS CO 21061 1500.137 6172 36180 36.86 20 2E+02 2011 GM GENERAL MOTORSCO 15499 1564.727 9190 38120 0 2012 20:07 2012 ON GENERAL MOTORS CO 18422 1366.374 6188 36744 O 28.33 22 2007 2OOR HPG HEWLETT-PACKARD CO 10153 2415 103 8329 38942 0.32 38.28 20 2E07 200 HP HEWLETT-PACKARD CO 13229 2364.809 7660 40512 0.32 47.46 ZA 2407 2010 UPO HEWLETT-PACKARD CO 10929 2203 898 3761 40449 0.32 42.04 1 un SEWLETTPACKARDON 1990 2074 25 4 2.61 Finance Game Play 05 Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share. Pay Date Price Close. 1 Date - Fiscal ol Company Name Cash outstanding (Loss Parent - Fiscal Annual - Fiscal 21 2E407 2012 GM GENERAL MOTORS CO 18422 1366.374 6188 36244 288 22 26.07 2005 HPG HEWLETT-PACKARD CO 10153 2415.303 8329 38942 0.32 38.28 23 26.07 2009 HPG HEWLETT PACKARD CO 13279 2364,809 7660 40517 0.32 47:46 24 2402 2010 HPO HEWLETT-PACKARD CO 10029 2203.898 8761 40449 0.32 42.04 25 26.07 2011 HPG HEWLETT PACKARD CO 8043 1990.506 7074 38625 0.4 26.61 26 2E407 2012 HP HEWLETT-PACKARD CO 11301 1962.838 - 12650 22436 0.504 13.85 27 2E+07 2008 IOM INTL BUSINESS MACHINE 12741 1339.096 12334 13465 1.9 84.16 2E07 2000 IBM INTL BUSINESS MACHINE 12182 1305.337 13425 22637 2.15 130,9 2.07 2010 IBM INTL BUSINESS MACHINE 10661 1227.993 14833 23046 2.5 146.76 10 2:07 2011 IAM INTL BUSINESS MACHINE 11922 1163.183 15855 20138 2.9 183.8 31 2E407 2012 M INTL BUSINESS MACHINE 10412 1117.368 16604 18860 3.3 191.55 32 2E07 2008 BAC BANK OF AMERICA CORP 32857 5017.436 4008 177052 0.04 14.05 33 2:07 2009 BAC BANK OF AMERICA CORP 121339 8650.244 6276 231444 0.04 15.00 34 2E07 2010 BAC BANK OF AMERICA CORP 108427 10085.155 - 2238 228248 0.04 13.34 2E07 2011 BAC BANK OF AMERICA CORP 120102 10535.938 1446 230101 0.04 5.56 2+07 2012 BAC BANK OF AMERICA CORP 110752 10778.264 4188 236956 0.04 37 11.61 2E+02 2008 MSFT MICROSOFT CORP 10339 9151 17681 36286 0.43 27.51 2E07 2009 MSET MICROSOFT CORP 6076 8908 14569 39558 22.77 2002 2010 MSFT MICROSOFT CORP 5SOS 8668 18760 46175 0.52 23.01 40 2402 2011 MSFT MICROSOFT CORP 9610 8376 23150 57083 0.61 220 41 2E02 2012 MSET MICROSOFT CORP 6938 8381 16978 363 0.76 30.59 42 2E07 2008 YHOO YAHOO INC 22923 1391 56 424.298 11250.942 12.2 2407 2009 YH00 YAHOO INC 1275.43 1406.075 597.992 12493.32 16.78 30 31 VHO VALDOING 1526 41 130 3 121 1755R 139 Finance Game Play 166 0.5 Clipboard Font Alignment Number Styles Cells N15 0.00 2007 c D Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share. Pay Date Price Close. 1 Date - Fiscal - - Company Name Cash Outstanding (Loss Parent - Fiscal Annual - Fiscal 2 2E402 2010 M INTL BUSINESS MACHINE 10661 1227.993 14833 23046 2.5 146.76 10 2E07 2011 IBM INTL BUSINESS MACHINE 11922 116.183 15855 20138 2.9 181,4H 91 2007 2012 AM INTL BUSINESS MACHINE 10412 117 368 16604 18860 13 191.55 2407 2008 BAC BANK OF AMERICA CORP 32857 5017436 4008 177052 14.00 11 26.07 2009 BAC IMNK OF AMERICA CORP 121339 8650.244 6276 231444 0.04 15.06 2007 2010 AM BANK OF AMERICA CORP 101427 10085.155 223 228248 0.04 14 2011 BAC BANK OF AMERICA CORP 120102 10535.938 1446 230101 0.04 5.56 10 2407 2012 BAC BANK OF AMERICA CORP 110752 10778264 4118 236956 0.04 11,61 37 26:07 2008 MSFT MICROSOFT CORP 10339 9151 17681 3626 0.43 27.51 38 2E407 2009 MUIT MICROSOFT CORP 0076 BON 14569 39558 0.5 23.72 19 2E07 2010 MSFT MICROSOFT CORP 5505 1668 18760 46175 0.52 2101 2:07 2011 MSFT MICROSOFT CORP 9610 8376 23150 52083 0.61 26 2407 2012 MSET MICROSOFT CORP 6338 8381 1678 66.363 6.76 30.59 26.07 2001 VHOO YAHOO INC 22923 1.991.56 424,29 11250,942 O 12.2 43 2:07 2009 YHOO YAHOO INC 1275.43 1406.075 597.992 12493.32 D 16.78 44 2:02 2010 VHOD YAHOO INC 1526.41 1308.836 1231.663 12558.129 0 16.63 45 2.02 2011 YHOO YAHOO INC 156239 1190.006 1048 827 12541067 16.13 21:07 2012 YOO YAHOO INC 2067.78 1115.233 1145.429 14560.2 199 2E+07 2008 GOOG GOOGLE INC 3656.67 315.114 4226.58 28238862 7.65 2E07 2009 GOOG GOOGLE INC 101916 317.772 6520.448 36004.224 $19.98 2-01 2010 GOOD GOOGLE INC 1:3630 121.300 8505 46241 59307 50 21407 2011 GOOGLE INC 9983 324 295 9737 58145 51 2E07 2012 GOOG GOOGLE INC 16778 329.979 10732 71715 707. Finance Game Play OOOOOOO B Ticker Common Net Stockholders Dividends per Data Data Year Symb Shares Income Equity - Share - Pay Date Price Close. 1 Date - Fiscal ol Company Name Cash Outstanding (Loss Parent - Fiscal Annual - Fiscal 29 2E07 2010 IBM INTL BUSINESS MACHINE 10661 1227.993 14833 23046 2.5 146.76 30 ZE+02 2011 IBM INTL BUSINESS MACHINE 11922 1163.183 15855 20138 2.9 183 88 31 2E07 2012 IBM INTL BUSINESS MACHINE 10412 1117.368 16604 18860 3.3 191 55 32 2.07 2008 BAC BANK OF AMERICA CORP 32857 5012.436 4008 177052 0.04 14,08 33 2407 2009 BAC BANK OF AMERICA CORP 121339 8650.244 6276 231444 0.04 15.06 34 20:07 2010 BAC BANK OF AMERICA CORP 108427 10085.155 -2238 228248 0,04 13.14 35 2E+07 2011 BAC BANK OF AMERICA CORP 120102 10535.938 1446 230101 0.04 5.56 36 2E407 2012 BAC BANK OF AMERICA CORP 110752 10778.264 4188 236956 0.04 11.61 37 2E07 2008 MSFT MICROSOFT CORP 10339 9151 17681 36286 0.43 27.51 38 2E+07 2009 MSFT MICROSOFT CORP 6076 8908 14569 39558 0.5 23.77 39 2E+07 2010 MSFT MICROSOFT CORP 5505 8668 18760 46175 0.52 23.01 00 20+07 2011 MSFT MICROSOFT CORP 9610 8376 23150 57083 0.61 26 41 2E407 2012 MSFT MICROSOFT CORP 6938 8381 16978 66363 0.76 30.59 42 2E+07 2008 YHOO YAHOO INC 22923 1391 56 424.298 11250.942 0 12.2 2E+07 2009 YHOO YAHOO INC 1275.43 1406.075 597.992 12493.32 0 16.78 44 2E07 2010 YHDO YAHOO INC 1526.43 1308.836 1231.663 12558.129 0 16.63 15 20+07 2011 YHOO YAHOO INC 156239 1190.006 1048.827 12541.067 0 16.13 45 2E+07 2012 YHOO YAHOO INC 2667.78 1115.233 3945.479 14560.2 19.9 47 2E+07 2008 GOOG GOOGLE INC 8656.62 315.114 4226.858 28238.862 307.65 49 2E07 2009 GOOG GOOGLE INC 101976 317.722 6520.448 36004.224 619.98 49 2E07 2010 GOOG GOOGLE INC 13630 321.301 BSOS 46241 593.92 50 2E407 2011 GOOG GOOGLE INC 9983 324895 9737 58145 645.9 51 2E+07 2012.GOOG GOOGLE INC 14778 329.979 10737 71715 707.38 OOOOOO B- Finance Game Play

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