Current stock price and target stock price

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Reference no: EM131860382

Summers Corp. currently has an EPS of $2.50, and the benchmark PE for the company is 24. Earnings are expected to grow at 6 percent per year.

a. What is your estimate of the current stock price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Current stock price $

b. What is the target stock price in one year? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)

Target stock price $

c. Assuming the company pays no dividends, what is the implied return on the company’s stock over the next year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Implied return of stock %

Reference no: EM131860382

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