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QUESTION
The following question was part of last year's midterm: Delta Airlines and United Airlines are major American airlines with extensive international...
The following question was part of last year's midterm:
Delta Airlines and United Airlines are major American airlines with extensive
international route networks. United has an enterprise value to EBIT (EV/EBIT)
multiple of 5.4. Delta has EBIT of $7.6 billion, outstanding debt of $11 billion, and
cash holdings of $4 billion, and 750 million shares outstanding.
Using the method of comparables, what should be Delta's stock price?
