Question

PRICE/EARNINGS RATIO A company has an EPS of $1.50, a book value per share of $14.55,...

PRICE/EARNINGS RATIO

A company has an EPS of $1.50, a book value per share of $14.55, and a market/book ratio of 1.4x. What is its P/E ratio? The stock price should be rounded to the nearest cent. Round your answer to two decimal places.


x

Homework Answers

Answer #1
Step-1:Calculation of market value per share
Market Value per share = Book Value per share * market /book ratio
= $    14.55 * 1.4
= $    20.37
Step-2:Calculation of Price/Earning Ratio
Price/Earning Ratio = Market Price Per share / EPS
= $    20.37 / $       1.50
= 13.58
Thus, P/E ratio is 13.58x
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
Company Ticker Price per Share Earnings per Share Book Value per Share Abbott Labs ABT 54.35...
Company Ticker Price per Share Earnings per Share Book Value per Share Abbott Labs ABT 54.35 3.69 13.79 Bristol-Myers-Squibb BMY 25.45 1.93 7.33 GlaxoSmithKline GSK 41.3 3.15 6.03 Johnson & Johnson JNJ 62.6 4.58 18.27 Merck MRK 36.25 3.81 10.86 Pfizer PFE $18.30 $1.20 8.19 Assuming that Novartis AG (NVS) has an EPS of $3.35, based upon the average P/E ratio for its competitors, Novartis' stock price is closest to: $44.35 $13.00 $31.86 $43.47
Company Ticker Price per Share Earnings per Share Book Value per Share Abbott Labs ABT 54.35...
Company Ticker Price per Share Earnings per Share Book Value per Share Abbott Labs ABT 54.35 3.69 13.79 Bristol-Myers-Squibb BMY 25.45 1.93 7.33 GlaxoSmithKline GSK 41.3 3.15 6.03 Johnson & Johnson JNJ 62.6 4.58 18.27 Merck MRK 36.25 3.81 10.86 Pfizer PFE $18.30 $1.20 8.19 Assuming that Novartis AG (NVS) has an EPS of $3.35, based upon the average price - to - book ratio for its competitors, Novartis' stock price is closest to: $39.70 $44.35 $13.00 $22.95
Do the Math 14-1 Numerical Measures A stock sells at $25 per share. What is the...
Do the Math 14-1 Numerical Measures A stock sells at $25 per share. What is the EPS for the company if it has a P/E ratio of 25? Round your answer to the nearest cent. $ _____ If the company’s dividend yield is 3 percent, what is its dividend per share? Round your answer to the nearest cent. $ ______ What is the book value of the company if the price-to-book ratio is 2.5 and it has 200,000 shares of...
A company's book value per share is $6.47. What is the company's intrinsic price-to-book ratio (to...
A company's book value per share is $6.47. What is the company's intrinsic price-to-book ratio (to two decimal places) if the present value of the next five year’s residual earnings is $1.22 per share and the present value of residual earnings beyond year five is $5.57 per share?
Earnings per share (EPS) over the last 12 months=$2.50 Earnings per share (EPS) over the next...
Earnings per share (EPS) over the last 12 months=$2.50 Earnings per share (EPS) over the next 12 months=$4.00 Current stock price=$45 Number of common shares outstanding=20,000,000 Restricted stock = 1,000,000 Annual dividend per share=$1.50 Expected annual growth rate in earnings over the next 5 years=5% Shares short=1,000,000 Average trading volume=10,000,000 shares 13. What is the market capitalization for YTB? (a) $600m (b) $700m (c) $800m (d) $900m 14. Based on your answer in question 13, YTB is a (a) mid-cap...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $15 par value (no change during the year) $3,900,000 Preferred $5 stock, $100 par (no change during the year) 3,000,000 The net income was $982,000 and the declared dividends on the common stock were $65,000 for the current year. The market price of the common stock is $22.40 per share. For...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $25 par value (no change during the year) $5,500,000 Preferred $5 stock, $200 par (no change during the year) 6,000,000 The net income was $678,000 and the declared dividends on the common stock were $55,000 for the current year. The market price of the common stock is $18.00 per share. For...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $15 par value (no change during the year) $2,400,000 Preferred $10 stock, $200 par (no change during the year) 4,000,000 The net income was $712,000 and the declared dividends on the common stock were $40,000 for the current year. The market price of the common stock is $24.00 per share. For...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $25 par value (no change during the year) $4,500,000 Preferred $8 stock, $100 par (no change during the year) 2,000,000 The net income was $376,000 and the declared dividends on the common stock were $45,000 for the current year. The market price of the common stock is $9.00 per share. For...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements...
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $15 par value (no change during the year) $4,350,000 Preferred $4 stock, $200 par (no change during the year) 8,000,000 The net income was $624,000 and the declared dividends on the common stock were $72,500 for the current year. The market price of the common stock is $12.00 per share. For...