Case study 2 (Valuation of stocks)
Smith is considering investing in stocks of Company P. Table 1 summarises data related to the stocks of Company P.
Table 1: Data related to the stocks of Company P
| Net income (in million $) | 5000 |
| Total dividends paid (in million $) | 2000 |
| Total book value of Equity (in million $) | 50000 |
| Total number of shares outstanding (in million) | 1000 |
| Current market price of the stock | $55 |
