Investors in Ranke Electric’s stock require a return of 7.3%. If the company simply earns the...
Investors in Ranke Electric’s stock require a return of 7.3%. If the company simply earns the cost of capital on its new investments, what is the stock’s P/E? (Round your answer to 2 decimal place.)
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Stock P/E Ratio |
Homework Answers
Return = 1/(P/E ratio)
P/E ratio=1/return
=1/0.073
=13.70
Hence P/E for the stock is 13.70
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