Question

Alphabet's market cap (total dollar value of all stock in the hands of investors) is currently...

Alphabet's market cap (total dollar value of all stock in the hands of investors) is currently about $900 billion, while the value of the net assets on its balance sheet totals about $200 billion. Explain one reason why these numbers are different. Please be specific. Limit your response to two sentences or less.

Homework Answers

Answer #2

Ans:

Market cap for Investors is $900 Billion but Net Assets is about $200 Billion. One of the reason behind that can be the past growth rate of the company, because of that even though the book value per share is very low, investors are ready to pay higher for this stock because of its high growth rate which shows future viability.

For any query please ask in comment box, we are happy to help you. Also please don't forget to provide your valuable feedback. Thanks!

answered by: anonymous
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
WACC. Look at the following book-value balance sheet for University Products Inc. The preferred stock currently...
WACC. Look at the following book-value balance sheet for University Products Inc. The preferred stock currently sells for $15 per share and pays a dividend of $2 a share. The coomon stock sells for $20 per share and has a beta of .8. There are 1 million common shares outstanding. The market risk premium is 10%, the risk free rate is 6% and the firm's tax rate is 40% Assets         (all numbers are in the millions)                         Cash& short -term...
Kurz Manufacturing is currently an​ all-equity firm with 22 million shares outstanding and a stock price...
Kurz Manufacturing is currently an​ all-equity firm with 22 million shares outstanding and a stock price of $8.00 per share. Although investors currently expect Kurz to remain an​ all-equity firm, Kurz plans to announce that it will borrow $47 million and use the funds to repurchase shares. Kurz will pay interest only on this​ debt, and it has no further plans to increase or decrease the amount of debt. Kurz is subject to a 35% corporate tax rate.   a. What...
Kurz Manufacturing is currently an​ all-equity firm with 18 million shares outstanding and a stock price...
Kurz Manufacturing is currently an​ all-equity firm with 18 million shares outstanding and a stock price of $ 11.50 per share. Although investors currently expect Kurz to remain an​ all-equity firm, Kurz plans to announce that it will borrow $ 45 million and use the funds to repurchase shares. Kurz will pay interest only on this​ debt, and it has no further plans to increase or decrease the amount of debt. Kurz is subject to a 30 % corporate tax...
Big Industries has the following market-value balance sheet. The stock currently sells for $20 a share,...
Big Industries has the following market-value balance sheet. The stock currently sells for $20 a share, and there are 1,000 shares outstanding. The firm will either pay a $1 per share dividend or repurchase $1,000 worth of stock. Ignore taxes. Assets Liabilities and Equity Cash $2,000 Debt $10,000 Fixed assets 28,000 Equity 20,000 What will be the price per share under each alternative (dividend versus repurchase)? (4 Marks) If total earnings of the firm are $2,000 a year, find earnings...
Kurz Manufacturing is currently an​ all-equity firm with 30 million shares outstanding and a stock price...
Kurz Manufacturing is currently an​ all-equity firm with 30 million shares outstanding and a stock price of $7.50 per share. Although investors currently expect Kurz to remain an​ all-equity firm, Kurz plans to announce that it will borrow $65 million and use the funds to repurchase shares. Kurz will pay interest only on this​ debt, and it has no further plans to increase or decrease the amount of debt. Kurz is subject to a 21% corporate tax rate.   a. What...
Please compute the following ratios using $237.36B. market cap Market value added Market to book ratio...
Please compute the following ratios using $237.36B. market cap Market value added Market to book ratio Return on Asset The Home Depot, Inc. Balance Sheet All numbers in thousands Period Ending 1/29/17 1/31/16 Current Assets Cash And Cash Equivalents 2,538,000 2,216,000 Short Term Investments - - Net Receivables 2,029,000 1,890,000 Inventory 12,549,000 11,809,000 Other Current Assets 608,000 569,000 Total Current Assets 17,724,000 16,484,000 Long Term Investments - - Property Plant and Equipment 21,914,000 22,191,000 Goodwill 2,093,000 2,102,000 Intangible Assets -...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for $15 per share and pays a dividend of $3 a share. The common stock sells for $16 per share and has a beta of 0.9. There are 3 million common shares outstanding. The market risk premium is 10%, the risk-free rate is 6%, and the firm’s tax rate is 21%. BOOK-VALUE BALANCE SHEET (Figures in $ millions) Assets - Liabilities and Net Worth Cash...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for $15 per share and pays a dividend of $3 a share. The common stock sells for $20 per share and has a beta of 0.6. There are 3 million common shares outstanding. The market risk premium is 9%, the risk-free rate is 5%, and the firm’s tax rate is 21%. BOOK-VALUE BALANCE SHEET (Figures in $ millions) Assets Liabilities and Net Worth Cash and...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for $30 per share and pays a dividend of $3 a share. The common stock sells for $20 per share and has a beta of 0.7. There are 2 million common shares outstanding. The market risk premium is 10%, the risk-free rate is 6%, and the firm’s tax rate is 40%. BOOK-VALUE BALANCE SHEET (Figures in $ millions) Assets Liabilities and Net Worth Cash and...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for...
Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for $30 per share and pays a dividend of $3 a share. The common stock sells for $16 per share and has a beta of 0.6. There are 3 million common shares outstanding. The market risk premium is 8%, the risk-free rate is 4%, and the firm’s tax rate is 40%. BOOK-VALUE BALANCE SHEET (Figures in $ millions) Assets Liabilities and Net Worth Cash and...