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Social ScienceYou want to value the stock of a company that is not publicly traded. This company hasearnings of $4.25 per share, BV of equity of $9.85 share, and CFs to equity of $1.85 per share.-You have the following information on firms that are extremely similar to the firm that you'retrying to value:4.Stock priceper share14.85aBV of equityper sharea7.25Earningsper sharea2.48CFs to equityshareCompanyper1.36AC8.14ВaCа65.416.6234.963.8636.0914.234.28Come up with three appropriate estimates of the stock price for your firm of interest.
I'm struggling on this problem and have to put it into excel with formulas.
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You want to value the stock of a company that is not publicly traded. This company has earnings of $4.25 per share, BV of equity of $9.85 share, and CFs to equity of $1.85 per share.- You have the following information on firms that are extremely similar to the firm that you're trying to value: 4. Stock price per share 14.85a BV of equity per sharea 7.25 Earnings per sharea 2.48 CFs to equity share Company per 1.36 AC 8.14 Вa Cа 65.41 6.62 34.96 3.86 36.09 14.23 4.28 Come up with three appropriate estimates of the stock price for your firm of interest.
Expert Answer
Computation of the stock price:
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A D 1 Particulars Company A В C 3 Stock price of a share (P) 4 Earnings for a share (E) 14.85 65.41 36.09 8.14 3.86 2.48 Book value of the 5 equity for a share (BV) Cash flow to 7.25 34.96 14.23 6.62 6 the equity for a share (CF) 1.36 4.28 5.99 7 P/E 8.04 9.35 8 P/BV 9 P/CF 2.05 1.87 2.54 10.92 9.88 8.43 10 Avg of P/E 11 Avg of P/BV 12 Avg of P/CF 13 Earnings of a share (given) Book value of the 7.79 2.15 9.74 4.25 9.85 14 equity for a share (given) Cash flow to 15 the equity for a share(given) 16 Price of the stock based on the earnings (1) 1.85 33.11 17 Price of the stock based on the book value (2) 18 Price of the stock based on the cash flow (3) 21.20 18.03
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