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Method of comparables

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Reference no: EM132121151

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?

Reference no: EM132121151

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