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Kreeman's Inc. has earnings per share of $12. If the industry average PE ratio is 20,...

Kreeman's Inc. has earnings per share of $12. If the industry average PE ratio is 20, what is the price of Kreeman's stock?

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Answer #1
P/E Ratio=Earnings per Share/ Price per Share​
The P/E shows whether a company's stock price is overvalued or undervalued.
Industry's averageP/E ratio 20
which means For $1 earning , benchmark price is $ 20 for industry.
Kreeman's incorporation's earning $12 per share
P/E ratio EPS
Price per share
As per industry's average
Price of per share of Kreeman's incorp 12*20
i.e. EPS of Kreeman's incorp.* P/E ratio $ 240.00
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