According to the information above, which company is undervalued? Why?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Use the data below to perform a relative valuation between Dunkin Donuts and Starbucks
Dunkin' Donuts
Starbucks Corporation
Price Per Share
$48.85
$53.93
Earnings Per Share
$1.44
$1.81
Price to Earnings
34.0
29.8
Market Capitalization
4.5 B
78.8 B
According to the information above, which company is undervalued? Why?
Transcribed Image Text:Use the data below to perform a relative valuation between Dunkin Donuts and Starbucks Dunkin' Donuts Starbucks Corporation Price Per Share $48.85 $53.93 Earnings Per Share $1.44 $1.81 Price to Earnings 34.0 29.8 Market Capitalization 4.5 B 78.8 B According to the information above, which company is undervalued? Why?
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