Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Aug 22, 2024

A company currently retains 66% of its earnings its earnings of a share this year. Assume the company's ROE is 15% and the required rate

A company currently retains 66% of its earnings its earnings of a share this year. Assume the company's ROE is 15% and the required rate of return is 15%. Calculate the forward P/E ratio of the company if the company is growing at a long-run sustainable pace.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Forecasting Principles And Practice

Authors: Rob J Hyndman, George Athanasopoulos

3rd Edition

0987507133, 978-0987507136

More Books

Students also viewed these Finance questions

Question

★★★★★

Sam Goldwyn, a movie producer during Hollywood's Golden Age in the 1930s and 1940s, once remarked about one of his stars: "We're overpaying him, but he's worth it." a. In what sense did Goldwyn mean...

Answered: 1 week ago

Question

★★★★★

11.10 Reducing Hostility A clinical psychologist wished to compare three methods for reducing hostility levels in university students using a certain psycho- logical test (HLT). High scores on this...

Answered: 1 week ago

Question

★★★★★

PlastiCo produces plastic pipe to customer specifications. Losses of less than 5 percent are considered normal because they are inherent in the production process. The company applies overhead to...

Answered: 1 week ago

Question

★★★★★

Question 2 ( 6 marks) The following are separate situations where the independence of the Auditor is subject to threat.You are asked to identify the name of the threat to the Auditors independence...

Answered: 1 week ago

Question

★★★★★

Samsung has sales of $44,000 and a net income of $21,000. Total assets are $50,000 and total equity is $35,000. The consumer electronics industry as a whole has the following characteristics: Ratio...

Answered: 1 week ago

Question

★★★★★

ABC Electronics Corporation will be expanding its products by manufacturing power banks. It expects to sell these over a period of three years by updating their power bank models throughout the...

Answered: 1 week ago

Question

★★★★★

A scooter manufacturer wants to increase brand awareness on its website. What type of graphic should the company include on every webpage?

Answered: 1 week ago

Question

★★★★★

How can you use data to assist you with making appropriate business decisions? Will you use internal data, external data, or both?

Answered: 1 week ago

Question

★★★★★

It is intellectually simple to formulate an elegant strategy but not so with its implementation. Discuss

Answered: 1 week ago

Question

★★★★★

Consider the following project where times are in weeks. Activity Immediate Predecessors Duration A - 8 B - 12 C A,B 7 D B 4 AND A 2 F C 3 G E,F 7 H D,F 3 what is the early start for activity B using...

Answered: 1 week ago

Question

★★★★★

What changes should be made to the Employment Insurance program to address its present weaknesses?

Answered: 1 week ago

Question

★★★★★

Besides retirement income, what other benefits are provided through the Canada Pension Plan?

Answered: 1 week ago

Question

★★★★★

Suppose a friend of yours contracted lead poisoning on the job. What sources of income could this person rely on while recovering during the next two months? What if it took two years for your friend...

Answered: 1 week ago

Previous Question Next Question