P/E Ratio = Price per shares/Earnings per share
= $23/($2,000,000/260,000)
= 2.99
Stock price one year from now:
= P/E Ratio×Earnings per share
= 2.99×($3,100,000/351,000)
= 2.99×$8.83
= $26.41
Hence, stock in one year is $26.41
Click here to read the eBook: Market Value Ratios P/E AND STOCK PRICE Ferrell Inc. recently...
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