BAsed on these inputs, estimate the price/book value ratio for NCH. B. How much would the return on equity have to increase to justify the price/book value ratio at which NCH sells for currently.
BAsed on these inputs, estimate the price/book value ratio for NCH. B. How much would the return on equity have to increase to justify the price/book value ratio at which NCH sells for currently.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Q2: NCH, which markets cleaning chemicals, insecticides, and other products, paid dividends of $2.00 per share on earnings of $4.00 per share. The book value of equity per share was @40.00 and earnings are expected to grow 5% a year in the long term. The stock has a beta of 0.85 and sells for $60 per share. The treasury bond rate is 7%.
A. BAsed on these inputs, estimate the price/book value ratio for NCH.
B. How much would the
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