Smith Company is a firm specializing in financial advice for retired individuals. After some analysis, you have determined that an earnings multiplier of 7 is appropriate for this type of business. Smith’s most recent earnings totaled $261,000 and earnings per share was $5.60. What is the estimated value of the firm based on the earnings multiplier?
Smith Company is a firm specializing in financial advice for retired individuals. After some analysis, you have determined that an earnings multiplier of 7 is appropriate for this type of business. Smith’s most recent earnings totaled $261,000 and earnings per share was $5.60. What is the estimated value of the firm based on the earnings multiplier?
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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Smith Company is a firm specializing in financial advice for retired individuals. After some analysis, you have determined that an earnings multiplier of 7 is appropriate for this type of business. Smith’s most recent earnings totaled $261,000 and earnings per share was $5.60. What is the estimated value of the firm based on the earnings multiplier?
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