P/E Ratio Model and Future Price Target Corp

question 95

Multiple Choice

P/E Ratio Model and Future Price Target Corp.(TGT) recently earned a profit of $3.57 earnings per share and has a P/E ratio of 17.3.The dividend has been growing at a 14 percent rate over the past few years.If this growth continues,what would be the stock price in five years if the P/E ratio remained unchanged? What would the price be if the P/E ratio increased to 23 in five years?

• A)$118.85, $158.01 respectively
• B)$137.19, $182.39 respectively
• C)$173.87, $231.15 respectively
• D)$308.81, $410.55 respectively

---

Definitions:

Risk Averse

Refers to the preference of individuals or organizations to avoid risk, choosing the option with the least uncertainty.

Small Business Person

An individual who owns and operates a business that is typically defined by its small size in terms of revenue and number of employees.

Perseverance

The sustained effort and determination in spite of difficulties, obstacles, or discouragement, essential for achieving long-term goals.

Environmental Factors

Environmental Factors are external elements such as weather, climate, and natural disasters, as well as socioeconomic aspects, that can affect an organization's operations, strategic decisions, and overall performance.