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Please complete each task separately in Excel spreadsheets.

Task 1. Regression Analysis of P/E Ratios

Run a Value Line search to download the data used to run regression analysis of current P/E ratios against retention ratios, 5-year betas, and projected EPS growth rates. Restrict your choice of industry to Chemical (Basic, Diversified, and Specialty). Run the regression analysis using Excel, check the statistical significance of the coefficients, interpret the coefficients, and generate the predicted current P/E ratio for Air Products & Chemical. What can you say about the stock? Is the stock overvalued or undervalued?

Task 2. Regression Analysis of P/B Ratios

Run a Value Line search to download the data used to run regression analysis of P/B ratios against returns on common equity, retention ratios, 5-year betas, and projected EPS growth rates. Restrict your choice of industry to Banks and Diversified Financial Services. Run a regression analysis using Excel. Check the statistical significance of the coefficients, interpret the coefficients, and generate the predicted P/B ratio for the Bank of New York Mellon. What can you say about the stock? Is the stock overvalued or undervalued?

Task 3. Regression Analysis of P/S Ratios

Run a Value Line search to download the data used to run regression analysis of P/S ratios against net profit margins, retention ratios, 5-year betas, and projected EPS growth rates. Restrict your choice of industry to Retail. Run a regression analysis using Excel, check the statistical significance of the coefficients, interpret the coefficients, and generate the predicted P/S ratio for Kohl's. What can you say about the stock? Is the stock overvalued or undervalued?

Corporate Finance, Finance

  • Category:- Corporate Finance
  • Reference No.:- M91231250

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