Estimate the price of another company's stock
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1. You have the following information on Target and Wal-Mart:
Target: P-E (which is Price/EPS) = 14.87
Wal-Mart: EPS = 15.42
a. Using Target as a comparable, estimate Wal-Mart's price
b. The current price of Wal-Mart is about $54 per share. How does your estimate compare to the current price (high, low or about the same)?
c. What is one problem with using a comparable (such as Target) to estimate the price of another firm (such as Wal-Mart)?
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Response helps in analyzing the price of another company's stock
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1. You have the following information on Target and Wal-Mart:
Target: P-E (which is Price/EPS) = 14.87
Wal-Mart: EPS = 15.42
a. Using Target as a comparable, estimate ...
Purchase this Solution
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