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
Problem 1PS
Related questions
Question

Transcribed Image Text:Consider the following table of Earnings Components:
Reported EPS
Analyst's EPS composition:
Permanent component (Bp = 5)
Transitory component (BT = 1))
Value-irrelevant component (Bo = 0)
The implied share price of Firm A's stock is:
Firm A
$12
80%
10%
10%
Firm B Firm C
$15 $18
60%
35%
5%
75%
25%
0%
I

Transcribed Image Text:Multiple Choice
$12.00
$48.00
$49.20
$54.40
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