business finance

Exercise 1: Theoretical question (150 words maximum)

Explain what are the pros and cons of the comparable/multiples valuation of the stocks? What are the most popular multiplicators for stock valuation?

Exercise 2: Practical valuation using P/E ratio.

Pick a stock of the publicly traded US-based company of your choice. What is the industry of the company? Use average industry P/E ratio and EPS (earnings per share) of the company to define the “fair” price of the stock.

Hint: you might find this data useful:

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/pedata.html