Q: The Perfect Rose Co. has earnings of $3.18 per share.
The Perfect Rose Co. has earnings of $3.18 per share. The benchmark PE for the company is 18. What stock price would you consider appropriate? What if the benchmark PE were 21?
See AnswerQ: TwitterMe, Inc., is a new company and currently has negative
TwitterMe, Inc., is a new company and currently has negative earnings. The company’s sales are $2.1 million and there are 130,000 shares outstanding. If the benchmark price-sales ratio is 4.3, what is...
See AnswerQ: Moody Farms just paid a dividend of $2.65 on its
Moody Farms just paid a dividend of $2.65 on its stock. The growth rate in dividends is expected to be a constant 3.8 percent per year indefinitely. Investors require a return of 15 percent for the fi...
See AnswerQ: Metallica Bearings, Inc., is a young start-up company. No dividends
Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years because the firm needs to plow back its earnings to fuel growth. The company will...
See AnswerQ: Maurer, Inc., has an odd dividend policy. The company has
Maurer, Inc., has an odd dividend policy. The company has just paid a dividend of $2.75 per share and has announced that it will increase the dividend by $4.50 per share for each of the next five year...
See AnswerQ: Lohn Corporation is expected to pay the following dividends over
Lohn Corporation is expected to pay the following dividends over the next four years: $13, $9, $6, and $2.75. Afterward, the company pledges to maintain a constant 5 percent growth rate in dividends f...
See AnswerQ: Synovec Co. is growing quickly. Dividends are expected to grow
Synovec Co. is growing quickly. Dividends are expected to grow at a rate of 30 percent for the next three years, with the growth rate falling off to a constant 4 percent thereafter. If the required re...
See AnswerQ: Elliott Credit Corp. wants to earn an effective annual return
Elliott Credit Corp. wants to earn an effective annual return on its consumer loans of 17.1 percent per year. The bank uses daily compounding on its loans. What interest rate is the bank required by l...
See AnswerQ: Mobray Corp. is experiencing rapid growth. Dividends are expected to
Mobray Corp. is experiencing rapid growth. Dividends are expected to grow at 25 percent per year during the next three years, 15 percent over the following year, and then 6 percent per year indefinite...
See AnswerQ: The next dividend payment by Savitz, Inc., will be $2.34
The next dividend payment by Savitz, Inc., will be $2.34 per share. The dividends are anticipated to maintain a growth rate of 4.5 percent forever. If the stock currently sells for $37 per share, what...
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