A company has earnings per share of $3.82 from which it just paid $1.34 in dividends (think payout rate).
The firm has an ROA of 15% and an ROE of 20%.
The market earns 12% while T-bills earn 4.5%. The stock has a beta of 1.35.
What is the price of the stock?
- $82.46
- $88.80
- $93.18
- $94.52