Suppose that the average P/E multiple in the chemicals industry is 26. Smart Chemical is expected tohave an EPS of S4.50 in the coming year. A reasonable estimate for intrinsic value of the stock shouldbe:A. None of the answers are correctB. $100.25C.$117.00D. $30.50E. $72.00

Intrinsic value is the actual true value of the stock of a particular company irrespective of the…

Suppose that the average P/E multiple in the chemicals industry is 26. Smart Chemical is expected to have an EPS of $4.50 in the coming year. A reasonable estimate for intrinsic value of the stock should be: A. None of the answers are correct B. $100.25 C.$117.00 D. $30.50 E. $72.00

Suppose that the average P/E multiple in the chemicals industry is 26. Smart Chemical is expected to have an EPS of $4.50 in the coming year. A reasonable estimate for intrinsic value of the stock should be: A. None of the answers are correct B. $100.25 C.$117.00 D. $30.50 E. $72.00

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter7: Stocks (equity) - Characterstics And Valuation

Section: Chapter Questions

Problem 18PROB

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