When calculating Earning Per Share (EPS) ,do we consider EBIT or PAT or neither?
Solution :-
EBIT stands for earning before interest and tax
PAT stands for Profit after tax
When we calculate the EPS we need to divide PAT by No. Of shares , condition there is no preference issue . This means we need to consider PAT Although PAT is also calculated by EBIT but directly if we see we use PAT while calculating EPS
When calculating Earning Per Share (EPS) ,do we consider EBIT or PAT or neither?
When we calculating ROE,do we consider both equity share holders fund and preferential share holders fund?
Question 4: Consider the value of company ALPHAFARM earning $10.00 in earnings per share (EPS) and currently paying $5 in dividends per share (DPS) per annum with earnings and dividends both expected to grow indefinitely at 3% per annum and discounted at 12% (i.e. a risk-free rate of 5% plus an equity risk premium of 7%). Calculate the value of APLHAFARM shares based on a dividend discount model (DDM) in perpetuity assuming constant growth rates indefinitely. (value to the nearest...
When we calculate EPS, do we consider number of preferential shares as well?
When we calculate dividend per share(DPS),do we consider dividend paid to both equity share holders and preference share holders or otherwise?
b-1. What is the EBIT/TA rate when the firm's have equal EPS? EBIT/TA rate b-2. What is the cost of debt? Cost of debt b-3. State the relationship between earnings per share and the level of EBIT. EPS is unaffected by financial leverage when the pre-tax return on assets (EBIT/TA) the cost of debt. c. If the cost of debt went up to 12 percent and all other factors remained equal, what would be the break-even level for EBIT? Break-even...
Firm DCF, ROE = 35% , Dividend Payout Ratio=70%, next year’s earning per share (EPS) = $8.00, assuming that market expected return is 20% and the risk-free rate is 5%. If increasing DPR will decrease firm value and we can use the constant dividend growth model to value the stock price, the stock beta must be larger than_____ and less than_____ (don't tell me the answer is 2.0 and 2.4) <- it's wrong (two decimals)
Firm DCF, ROE = 35% , Dividend Payout Ratio=70%, next year’s earning per share (EPS) = $8.00, assuming that market expected return is 20% and the risk-free rate is 5%. If increasing DPR will decrease firm value and we can use the constant dividend growth model to value the stock price, the stock beta must be larger than [a] and less than [b] what is [a] and [b]?
how did they calculate earning per share when the market is fooled and when the market is smart? can this be calculated if not given Total earning? if so how info do I need to calculate it. Innovative Concepts (after the acquisition) Innovative Concepts The Market is QuickResolve The Market is Fooled Smart 1.68 S $1.20 $ 15.00 S 1.68 Earnings per share Price per share $1.50 $45 $ 50.40 $45 26.79 12.5 Price-earnings ratio 30 30 100,000,000 $150,000,000 $4,500,000,000...
6. EBIT-EPS analysis - Part II Aa Aa Mother Earth Inc. (MEI) was started three years ago by two friends who recently graduated from Blue Rock College. MEI, a multimillion-dollar distributor of environmentally friendly products, currently sells products made by other manufacturers. The management team is now considering the purchase of the manufacturer of MEI's bestselling product. The acquisition is expected to cost $6,000,000, but MEI's chief financial officer (CFO) is unclear as to whether the purchase should be financed...
When we calculating ROE and ROA,do we consider Net Income after Tax or before Tax