Multiple Choice
An analyst has determined that the intrinsic value of Dell stock is $34 per share using the capitalized earnings model.If the typical P/E ratio in the computer industry is 27, then it would be reasonable to assume the expected EPS of Dell in the coming year will be
A) $3.63.
B) $4.44.
C) $14.40.
D) $1.26. $34(1/27) = $1.26.
Correct Answer:
Verified
Correct Answer:
Verified
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