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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Hav Co (6/13)
Hi,
I would like to ask regarding the current value calculations for both Hav Co and Strand Co (b).
To find Strand Co’s current value is to take the estimated P/E ratio multiply by post PAT in 20×3.
To find Hav Co’s current value, they take the share price times number of shares.
However,
I do not get the same answer if I take Hav’s P/E ratio times the post PAT. Same goes to when I tried multiplying Strand’s share price with number of share. Why is that ? How would I know which method to use ?
The 5th paragraph of the question says how each of the two companies think that the price should be calculated 🙂