Problem:
Plush Pilots, Inc. has balance sheet equity of $5.2 million. At the same time, the income statement shows net income of $743,600. The company paid dividends of $423,852 and has 130,000 shares of stock outstanding.
Required:
Question: If the benchmark PE ratio is 21, what is the target stock price in one year?
Note: Be sure to show how you arrived at your answer.