Justified P/ B ratio = (ROE - g)/(r - g) = ( 23% - 7.6%) / ( 14% - 7.6%) = 2.4063
Closest to $2.41
Option b, $ 2.41
A company recently paid a dividend of $1.35 a share. It has a payout ratio of...
An analyst has determined that a firm has A payout ratio of 75% A return on equity (ROE) of 18% An earnings per share (EPS) of $5.35 • Sales per share of $342 Expected earnings/ dividends/sales growth of 4.5% Shareholders required retum of 15% The firm's justified price-to-sales ratio (P/S) multiple based on the above fundamentals is closest to: Select one O a 0.471 O b.0.116 c. 0.302 O d. 0.231
Estimating Growth A firm has a constant dividend payout ratio. Last year the firm had net income of $30 million and paid out dividends of $6 million. The firm's return on equity is expected to be 13% for the foreseeable future. This stock's growth rate in dividends (g) should be
A company has reported $4 per share in earnings, and maintains a 50% dividend payout ratio. Its book value per share is $25. What is the expected growth rate in dividends? 4% 8% 12% 16%
A company has reported $4 per share in earnings, and maintains a 50% dividend payout ratio. Its book value per share is $25. What is the expected growth rate in dividends? 4% 8% 12% 16% Stormy-seas Corp has just paid a dividend of $3 per share out of earnings of $5 per share. What is the required rate of return on this stock if its book value is $40 and current market price is $52.50? 5% 6% 11% 12% Pirate...
1. ABC Corp. has an ROE (return on reinvested earnings) of 20% and a dividend payout ratio of 40%. The next annual earnings are expected to be $3 per share (that is, EPS in year 1 is $3.00). The firm's required return on the stock is 17%. The value of the stock today is $____________. 2. Company A just paid a $1.00 dividend per share and its future dividends are expected to grow at an annual rate of 6% for the...
1. ABC Corp. has an ROE (return on reinvested earnings) of 20% and a dividend payout ratio of 40%. The next annual earnings are expected to be $3 per share (that is, EPS in year 1 is $3.00). The firm's required return on the stock is 17%. The value of the stock today is $____________. 2. Company A just paid a $1.00 dividend per share and its future dividends are expected to grow at an annual rate of 6% for the...
1) A company recently paid out a $4 per share dividend on their stock. Dividends are projected to grow at a constant rate of 5% into the future, and the required return on investment is 8%. After one year, the holding period return to an investor who buys the stock right now will be: A. 5% B. 3% C. 8% D. 13% 2) A company recently paid out a $2 per share dividend on their stock. Dividends are projected to...
McCracken Roofing, Inc., common stock paid a dividend of $1.35 per share last year. The company expects earnings and dividends to grow at a rate of 5% per year for the foreseeable future. a. What required rate of return for this stock would result in a price per share of $22 b. If McCracken expects both earnings and dividends to grow at an annual rate of 11%, what required rate of return would result in a price per share of...
Denver Company (DC) expects to pay a dividend of $1.28 in exactly one year. DC has recently invested in multiple wealth increasing projects and expects its operating cash flow to increase dramatically for a few years. DC expects a dividend growth rate of 50% during years 2, 3, and 4. After that high growth period, a normal growth rate of 3.1% will occur. DC shareholders require a 14.7% return. The DC stock price is closest to: A. $45.46 B. $33.91...
(Measuring growth) Solarpower Systems earned $20 per share at the beginning of the year and paid out $8 in dividends to shareholders (so. Do = $8) and retained $12 to invest in new projects with an expected return on equity of 19 percent. In the future, Solarpower expects to retain the same dividend payout ratio, expects to earn a return of 19 percent on its equity invested in new projects, and will not be changing the number of shares of...