Asked by
Steven Hodge
on Oct 15, 2024
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A company has net income of $90,000; its weighted-average common shares outstanding are 18,000.Its dividend per share is $0.45,its market price per share is $88,and its book value per share is $76.Its price-earnings ratio equals:
A) 9.0.
B) 17.6.
C) 12.5.
D) 15.2.
E) 16.9.
Price-Earnings Ratio
A valuation metric for a company, calculated by dividing its current share price by its per-share earnings.
Net Income
The total profit of a business after all expenses, including taxes and operating costs, are subtracted from total revenues.
Weighted-Average Common Shares
The weighted-average common shares are calculated to represent the number of shares outstanding over a period, adjusted for changes such as stock splits.
- Comprehend and compute dividend yield and price-earnings ratio, along with their importance for investors.
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TA
Learning Objectives
- Comprehend and compute dividend yield and price-earnings ratio, along with their importance for investors.