The mathematical expression for the price of a stock at time t using a benchmark PE ratio is Blank______. (EPS denotes earnings per share.) Multiple choice question. Pt = Benchmark P/E ratio/Dividend per share Pt = Benchmark P/E ratio/EPSt Pt = Benchmark P/E ratio × EPSt Pt = Benchmark P/E ratio × Dividend per share

The mathematical expression for the price of a stock at time t using a benchmark PE ratio is Blank______. (EPS denotes earnings per share.) Multiple choice question. Pt = Benchmark P/E ratio/Dividend per share Pt = Benchmark P/E ratio/EPSt Pt = Benchmark P/E ratio × EPSt Pt = Benchmark P/E ratio × Dividend per share

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 78E: Ratio Analysis Consider the following information. Required: Calculate the stockholder payout...

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Given the following information on five stocks, construct: a. A simple price-weighted average b. A value-weighted average c. A geometric average d. What is the percentage increase in each average if the stock prices change to those in Column I? e. What is the percentage increase in each average if the stock prices change from those in the Price column to those in Column II? f. Why were the percentage changes different in parts (d) and (e)? g. If you were managing a fund and wanted a source to compare your results to, which of the three averages would you prefer to use, and why? Stock Price # of Shares I II A B C D E F $12.00 150,000 $14.00 125,000 $11.00 200,000 $ 22.00 80,000 $8.00 30,000 $29.00 140,000 $12.00 $12.00 $14.00 $14.00 $20.00 $11.00 $ 22,00 $ 22.00 $8.00 $15.00 $29.00 $29.00
The Price-Earning ratio (P/E) of stock A, B, C are 5, 3, 7 respectively. Which one you should buy?
Which of the following ratios would analysts use to value stocks? Select one: a. All of the above b. Price per Earnings c. Price per sales d. Price per cash flow
A price-weighted index such as the DJIA is a geometric mean of current stock prices. a. True b. False
What is the formula for Price to Book Value ( MV/BV) ratio ? If Current Price = 126, Total Equity = 20.000.000E , and number of shares =2.000.000 %3D compute the P/ BV and interpret it.
2.) Consider the expected returns, standard deviations, Sharpe ratios, and correlation matrix for three stocks: Correlation Matrix Pij Stock E(Ri) Stock 1 Stock 2 Stock 3 Sharpe 1 0.13 0.21 1.00 0.10 0.35 0.476 2 0.16 0.22 0.10 1.00 0.72 0.591 3 0.24 0.59 0.35 0.72 1.00 0.356 Use the Solver function in Excel to find the portfolio weights, portfolio expected return E(rp), portfolio standard deviation σp, and Sharpe ratio for the following optimal portfolios: P a.) The risky asset portfolio that minimizes standard deviation for a target expected return of 18%. Do not constrain short-sales. b.) The risky asset portfolio that maximizes the Sharpe ratio, short sales. Assume a risk-free rate of 3%. E(rp)-rf бр . Do not constrain
Ratio Analysis Consider the following information. Required: Calculate the stockholder payout ratios. (Note: Round answers to two decimal places.) Calculate the stockholder profitability ratios. (Note: Round answers to two decimal places.)
Answer the multiple-choice question below: 1. Which of the following ratios would analysts use to value stocks? Select one: a. Price per Earnings b. Price per sales c. Price per cash flow d. All of the above
Using the information in the table below, 1.Calculate the Price Earnings Ratio for both stocks. Share Price Per Share Stock X ($) 25 Earnings Per Share 2.00 Stock Y ($) 20 0.67 2. Interpret the results obtained in part above, by highlighting the implications for a firm of having a low P/E or a high P/E.
Practice Help, please.
Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 3.6% + 1.2RM + eA RB = -1.6% + 1.5RM + eB OM = 16%; R-squarea = 0.25; R-square; = 0.15 What is the covariance between each stock and the market index? (Calculate using numbers in decimal form, not percentages. Do not round your intermediate calculations. Round your answers to 3 decimal places.) Covariance Stock A Stock B
Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 3.6% + 1.20RM + eA RB = -1.6% + 1.50RM + eB OM = 16%; R-squareд = 0.25; R-squarep = 0.15 What is the covariance between each stock and the market index? Note: Calculate using numbers in decimal form, not percentages. For example use "20" for calculation if standard deviation is provided as 20%. Do not round your intermediate calculations. Round your answers to nearest whole number. Stock A Stock B Covariance