Question: P/E Ratio Model and Future Price Walmart (WMT) recently earned a profit of $3.13 per share and has a P/E ratio of 14.22. The dividend has been growing at a 12.5 percent rate over the past few years?
a. What will be the profit per share in 5 years?
b. What would be the stock price in five years if the P/E ratio remained as 14.22?
c. What would the stock price in five years if the P/E ratio declined to 10?