Historically, Jones Trucking has had a price-to- earnings ratio of 14.6. The firm has a current net income of $92,000 with 85,000 shares of stock outstanding. The EPS growth rate is 4.5 percent. What is the expected price of this stock one year from now? A. $15.32 B. $15.85 C. $16.41 D. $16.51 E. $17.10

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter12: The Cost Of Capital
Section: Chapter Questions
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Historically, Jones Trucking has had a price-to-
earnings ratio of 14.6. The firm has a current net
income of $92,000 with 85,000 shares of stock
outstanding. The EPS growth rate is 4.5 percent.
What is the expected price of this stock one year
from now?
A. $15.32
B. $15.85
C. $16.41
D. $16.51
E. $17.10
Transcribed Image Text:Historically, Jones Trucking has had a price-to- earnings ratio of 14.6. The firm has a current net income of $92,000 with 85,000 shares of stock outstanding. The EPS growth rate is 4.5 percent. What is the expected price of this stock one year from now? A. $15.32 B. $15.85 C. $16.41 D. $16.51 E. $17.10
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