Question
Company A has EPS of $2. The payout ratio is 60 percent. The earnings are expected to grow at 5 percent a year for a
Company A has EPS of $2. The payout ratio is 60 percent. The earnings are expected to grow at 5 percent a year for a long time. The cost of equity is 10 percent. What is the justified leading P/E? Please show workings.
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Focus On Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert Hughes, Melissa Hart
6th Edition
125991965X, 978-1259919657
