Estimate the share price for Beagle Beauties

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Reference no: EM132853827

Problem - Beagle Beauties engages in the development, manufacture, and sale of a line of cosmetics designed to make your dog look glamorous. Below you will find selected information necessary to compute some valuation estimates for the firm. Assume the values provided are from year-end 2019. Also assume that the firm's equity beta is 1.30, the risk-free rate is 2.30 percent, and the market risk premium is 6.0 percent.

Dividends per share $2.32

Return on equity 8.50%

Book value per share $19.15

 

Earnings

Cash Flow

Sales

2019 value per share

$5.00

$6.30

$25.65

Average price multiple

13.10

9.56

2.50

Forecasted growth rate

13.62%

11.27%

7.06%

Using the PE, P/CF, and P/S ratios, estimate the 2020 share price for Beagle Beauties.

Reference no: EM132853827

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