Problem 7.26 – Sunset Corp.

Essentials of Corporate Finance

Ross, Westerfield, and Jordan

10th Edition and 11th Edition

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The Sunset Corp. currently has an EPS of $4.25 and the benchmark PE for the company is 19. Earnings are expected to grow at 5 percent per year. (Your numbers will vary). Determine the stock price today, the stock price in one year, and the implied return.

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