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Unformatted text preview: above the average high S&P 500 P/E ratio for the last 10 years. (Carry your calculation of the P/E ratio two places to the right of the decimal point in this problem.) What would the stock price be, based on estimated earnings per share of $3.00 (for 2004)? Average high S&P 500 P/E ratio for last 10 years = 23.70 20% above 23.70 = 1.2 * 23.70 = 28.44 Price = EPS 2004 * P/E 10-year high predicted Price = $3.00 * 28.44 = $85.32...
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This note was uploaded on 05/10/2010 for the course BUS 261 taught by Professor Shi during the Spring '10 term at Diablo Valley College.
- Spring '10