What market price will observe for dbs

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Problem 1: Dauterive Barber Shops (DBS) earned $3.50 per share this year. Earnings are expected to grow at 5% next year. DBS pays out 60% of earnings as dividends. If similar firms currently have P/E ratios of 7.5 based on forecasted earnings, what market price will we observe for DBS?

Reference no: EM132917691

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