Reference no: EM133072252
1. A stock has a price of $40.4 and earnings per share of $3.11. What is the price-earnings ratio?
Enter your response below rounded to 2 DECIMAL PLACES.
2. A preferred stock will have an annual dividend next period of $2.17 that will be paid in perpetuity. The discount rate is 9.4%. What is the current price of the stock?
Enter your response below rounded to 2 DECIMAL PLACES.
3. A company is expected to have earnings per share of $3.4 this year and to pay a dividend of $2.33. The discount rate for the stock is 17.4% and the rate of return on reinvested earnings is 20.6%. What is the sustainable growth rate? Enter your answer as a percentage. Do not include the percentage sign in your answer.
Enter your response below rounded to 2 DECIMAL PLACES.
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4. Consider a stock that is expected to pay a dividend of $1.32 one year from now. The dividend is expected to grow at a constant rate of 1.5% per year forever. Firms in the same industry provide an expected rate of return of 13.2%. What is the current price of the stock?
Enter your response below rounded to 2 DECIMAL PLACES.
5. Stark Industries expects an earnings per share of $2.87 and reinvests 40% of its earnings. Management projects a rate of return of 5% on new projects and investors expect a 5% rate of return on the stock. What is the sustainable growth rate? Enter your answer as a percentage. Do not include the percentage sign in your answer.
Enter your response below rounded to 2 DECIMAL PLACES.
6. A stock has a return on equity of 16.2% and a plowback ratio of 50%. What is the sustainable growth rate? Enter you answer as a percentage. Do not include the percentage sign in your answer.
Enter your response below rounded to 2 DECIMAL PLACES.
7. Grape Co. has a stock that has a current price of $55.6. A year from now, the stock is expected to pay a dividend of $1.9 and the price will be $52.76. What is the expected rate of return for this stock? Enter your answer as a percentage. Do not include the percentage sign in your answer.
Enter your response below rounded to 2 DECIMAL PLACES.
8. Consider a stock that will have dividends in the next three periods of $1.50, $1.74, and $1.79, respectively. The interest rate is 11%. What is the growth rate of the dividend in period 3? Enter your answer as a percentage. Do not include the percentage sign in your answer.
Enter your response below rounded to 2 DECIMAL PLACES. %
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