2. Look up General Mills, Inc., and Kellogg Co. The companies’ ticker symbols are GIS and K.

a. What are the current dividend yield and price–earnings ratio (P/E) for each company?

How do the yields and P/Es compare with the average for the food industry and for the stock market as a whole? (The stock market is represented by the S & P 500 index.)

b. What are the growth rates of earnings per share (EPS) and dividends for each company over the last five years? Do these growth rates appear to reflect a steady trend that could be projected for the long-run future?

c. Would you be confident in applying the constant-growth DCF valuation model to these companies’ stocks? Why or why not?