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iVinArrow [24]
3 years ago
7

Sunset Corp. currently has an EPS of $2.21, and the benchmark PE for the company is 21. Earnings are expected to grow at 5 perce

nt per year. a. What is your estimate of the current stock price
Business
1 answer:
storchak [24]3 years ago
8 0

Answer:

$46.41

Explanation:

Sunset corporation has an EPS of $2.21

The benchmark PE is 21

The earnings are expected to grow at 5 % per year

Therefore the current stock price can be calculated as follows

= benchmark PE × earnings per share.

= 2.21 × 21

= $46.41

Hence the estimate of the current stock price is $46.41

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