(SOLVED) Go to finance yahoo com and obtain the price earnings ratios of Adobe


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$19

Go to finance.yahoo.com and obtain the price-earnings ratios of Adobe Systems (ADBE) and American Electric Power (AEP). Which of these two firms seem to more of a “growth stock”? Now obtain a forecast of each firm’s expected earnings per share in the coming year. You can find earnings forecasts on yahoo.com under “Analysts Estimates: What is the present value of growth opportunities for each firm as a fraction of its stock price? (Assume, for simplicity, that the required rate of return on the stock is r = 8%.) Are the relative values you obtain for PVGO consistent with the P/E ratios?

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$19