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QUESTION
A company has earnings per share of $3.82 from which it just paid $1.34 in dividends (think payout rate). The firm has an ROA of 15% and an ROE of...
A company has earnings per share of $3.82 from which it just paid $1.34 in dividends (think payout rate).
The firm has an ROA of 15% and an ROE of 20%.
The market earns 12% while T-bills earn 4.5%. The stock has a beta of 1.35.
What is the price of the stock?
$82.46
$88.80
$93.18
$94.52
