In March 2017,Amazon and Clorox reported nearly identical earnings per share,but the stock price of Amazon was more than six times higher than the Clorox stock price.The most likely explanation for that difference is that ________.

Question

Quizplus · Accepted Answer

The most probable reason for the difference in the stock price of Amazon and Clorox, despite having almost the same earnings per share, is that investors see better long-term prospects for Amazon. This could be because Amazon is an innovative company with a track record of disrupting traditional retail markets and has diversified into various industries like cloud computing, entertainment, and digital advertising. Investors may expect Amazon's future earnings to grow faster than Clorox, which primarily operates in the consumer goods industry.

In March 2017,Amazon and Clorox Reported Nearly Identical Earnings Per