The table that follows shows the stock price, earnings per share, and dividends per share for...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The table that follows shows the stock price, earnings per share, and dividends per share for three companies for a recent year: Earnings Dividends Price per Share per Share Deere & Company (DE) $103.04 $4.83 $2.40 Alphabet (GOOG) 792.45 20.91 0.00 The Coca-Cola Company (KO) 178.85 1.51 1.40 a. Determine the price-earnings ratio and dividend yield for the three companies. Round to one decimal place. If an amount should be zero, enter in "0". Price-Earnings Ratio Dividend Yield Deere & Company Alphabet The Coca-Cola Company % b. Explain the differences in these ratios across the three companies by completing the following: Deere & Company has the lowest v price-earnings ratio, and is expected to produce shareholder returns through a combination of some share price appreciation and a moderate dividend v Coca-Cola has a low v dividend yield and high v price-earnings ratio. Alphabet pays no v dividend and, thus, has no v dividend yield. Alphabet has a high v price-eamings ratio. Feedback T Check My Work a. Divide stock price per share by earnings per share. Divide dividends per share by stock price per share. b. Consider the relationship of each account and how it relates to the industry numbers. The table that follows shows the stock price, earnings per share, and dividends per share for three companies for a recent year: Earnings Dividends Price per Share per Share Deere & Company (DE) $103.04 $4.83 $2.40 Alphabet (GOOG) 792.45 20.91 0.00 The Coca-Cola Company (KO) 178.85 1.51 1.40 a. Determine the price-earnings ratio and dividend yield for the three companies. Round to one decimal place. If an amount should be zero, enter in "0". Price-Earnings Ratio Dividend Yield Deere & Company Alphabet The Coca-Cola Company % b. Explain the differences in these ratios across the three companies by completing the following: Deere & Company has the lowest v price-earnings ratio, and is expected to produce shareholder returns through a combination of some share price appreciation and a moderate dividend v Coca-Cola has a low v dividend yield and high v price-earnings ratio. Alphabet pays no v dividend and, thus, has no v dividend yield. Alphabet has a high v price-eamings ratio. Feedback T Check My Work a. Divide stock price per share by earnings per share. Divide dividends per share by stock price per share. b. Consider the relationship of each account and how it relates to the industry numbers.
Expert Answer:
Answer rating: 100% (QA)
Price Earnings ratio Deere Alphabet Coca cola Price per share 10304 79245 17... View the full answer
Related Book For
Investment Analysis and Portfolio Management
ISBN: 978-0538482387
10th Edition
Authors: Frank K. Reilly, Keith C. Brown
Posted Date:
Students also viewed these finance questions
-
A machine costs $700,000 and is expected to yield an after-tax net income of $52,000 each year. Management predicts this machine has a 10-year service life and a $100,000 salvage value . Compute this...
-
A machine costs $380,000 and is expected to produce the following cash flows: If the cost of capital is 12%, what is the machine'sNPV? Year 1 2345 6 79 0 68 50 Cash flow ($000s) 50 57 75808592
-
The market interest rate is 5% and is expected to stay at that level. Consumers can borrow and lend all they want at this rate. Explain your choice in each of the following situations: a. Would you...
-
Pty is in the process of developing several new products. One of them is innovative gymnastic equipment. The estimated labour time for the first unit is 12 hours but a learning curve of 80% is...
-
Open the file Accounting Allocations.xls (on the book web site) to see a list of sample accounts that a firm has for their various plants. Your team has already gone through these accounts and has...
-
Consider a two-unit parallel system (i.e., the system operates if at least one unit is operating). The lifetimes of the units have an exponential distributions with parameter \(\lambda\). There is...
-
What goals should be accomplished during a witness interview? What are the question-asking techniques you can use to accomplish these goals? Give an example of each.
-
Accounting Treatment of Purchase Discounts Shawnee Corp., a household appliances dealer, purchases its inventories from various suppliers. Shawnee has consistently stated its inventories at the lower...
-
Flexible Budget. (CPA, adapted) The Panhandle Corporation operates its production departments under a flexible budget with monthly allowances established for 20% intervals. Capacity is based on...
-
Examine the following summary of the U.S. balance of payments for 2000 (in $ billion) and fill in the blankentries. Debits 1,418.64 774.86 352.90 - 1,809.18 Balance on current account 3 securities...
-
5. Mr. James wants to put all of his savings into a retirement fund which invests in 2 stocks: Paragon Ltd and Rausing Corporation. It has been observed over the past year that the standard...
-
What are the key components of the Procedural Data Element? Give examples.
-
What are the key components of the Mission Resources Element? Give examples.
-
What are the key components of the Equipment Element? Give examples.
-
A researcher stands at the end of a lakeside pier, \(4.0 \mathrm{~m}\) above the water surface and \(6.0 \mathrm{~m}\) away from a buoy floating on the lake (Figure P33.56). A rope hangs from the...
-
What is a System Element?
-
1. Define 5D in your own words. If it was defined as an operation that uses "trochoidal passes with a big and tightly controlled maximal radial engagement", what operation is being referred to? 2. Is...
-
Research corporate acquisitions using Web resources and then answer the following questions: Why do firms purchase other corporations? Do firms pay too much for the acquired corporation? Why do so...
-
Given the low risk in dog food, your required rate of return on SDC is 13 percent. What P/E ratio would you apply to the firm's earnings?
-
a. Compute the average monthly return and monthly standard return deviation for each portfolio and all three risk factors. Also state these values on an annualized basis. b. Based on the return and...
-
What does the EMH imply for the use of technical analysis?
-
Given perceptual problems and biases, such as stereotyping and the similar-to-me effect, proponents of affirmative action argue that organizations need to take proactive steps to ensure that...
-
Think about the last meeting or gathering you attended. It could be a meeting that took place at the organization you are currently working for, a meeting of a club or student organization you are a...
-
Positive reinforcement can be used to promote the learning of desired behaviors in organizations. Commission pay plans, for example, reinforce salespeople for selling by paying them a percentage of...
Study smarter with the SolutionInn App