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IP Assignment - Q5

Discussion in 'Financial Planning Study Group' started by SteelMonkey, 28th Mar, 2010.

  1. SteelMonkey

    SteelMonkey Member

    Joined:
    11th Feb, 2009
    Posts:
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    Location:
    Perth, WA
    Hi All

    Hoping someone can help me out, I am working on question 5 of the assignment and am trying to figure out the fair price for the WOW share based on the earnings forecast.

    If anyone could help out with the formula to use to figure this out it would be great!
     
  2. chels84

    chels84 Member

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    5th Mar, 2010
    Posts:
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    Location:
    Newcastle, NSW
    Hi Steelmonkey,

    The formula to work out the Fair price is: EPS x P/E Ratio.
     
  3. Jennylichen

    Jennylichen Member

    Joined:
    14th Mar, 2009
    Posts:
    20
    Location:
    Sydney, NSW
    Hi guys
    I stop at Q5 c.
    I just want to confirm my answers with you.
    Q5
    a P/E 24.7
    b Fair price 20.86
    If my answer is correct, then I can be confident to move on q5 c.
    Many thanks
     
  4. chels84

    chels84 Member

    Joined:
    5th Mar, 2010
    Posts:
    5
    Location:
    Newcastle, NSW
    Yes that is correct.