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The average industry PE ratio for retail companies is 20. Amazon’s own PE ratio is 73.27....

The average industry PE ratio for retail companies is 20. Amazon’s own PE ratio is 73.27. What is the estimated price of Amazon if earnings per share are projected to be $24 by using the comparables method?

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Answer #1

Estimated price=(Earnings per share)*(Industry PE)
=24*20=480
So, the estimated price is $480

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