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Stock XYZ has a P/E ratio of 16.3. You are trying to value another similar stock,...

Stock XYZ has a P/E ratio of 16.3. You are trying to value another similar stock, ABC, with earnings of $0.8. If you use a comparables approach, what should ABC be worth? Carry out calculations to at least 4 decimal places. Enter percentages as whole numbers. Example: 3.03% should be entered as 3.03. Do not include commas or dollar signs in numerical answers.

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Answer #1

We can calculate value of a stock by using P/E ratio & earning of the stock.

Value of stock = P/E ratio * earning of stock

xYziS 16.3 we hauVolu Stock Asc Le rotio Vek Staek ABc AB C 16.3 x0.8

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