PAC has a projected Net Income next year of $10,000,000 on a basis of 8,000,000 outstanding shares. Their traditional payout ratio is 30% and they have $75,000,000 worth of equity. Assume inflation is 3% and that other stocks of similar risk-return 13%.

a.What is PAC's expected EPS next year?

b. What is the amount of PAC's expected next dividend per share?

c. What is PAC's sustainable growth rate?

d. According to the Gordon Constant Growth Model, what should be the current price per share of PAC's stock?

e. If PAC pays a $0.30 dividend per share right now, what would be the dividend yield of the stock?

Answer rating: 100% (QA)

What is PACs expected EPS next year Net income outstanding shares 10... View the full answer