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If you look at stock prices over any year, you will find a high and...

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Accounting

If you look at stock prices over any year, you will find a high and low stock price for the year. Instead of a single benchmark PE ratio, we now have a high and low PE ratio for each year. We can use these ratios to calculate a high and a low stock price for the next year. Suppose we have the following information on a particular company over the past four years:

Year 1 Year 2 Year 3 Year 4
High price $ 99.00 $ 122.60 $ 132.00 $ 148.63
Low price 73.83 89.94 70.62 117.15
EPS 8.28 10.03 11.11 12.50

Earnings are projected to grow at 8 percent over the next year.

a. What is your high target stock price over the next year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
b. What is your low target stock price over the next year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

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