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Rubenstein Bros. Clothing is expecting to pay an annual dividend per share of $0.55 out of annual earnings per share of $4.75. Currently, Rubenstein Bros.'
Rubenstein Bros. Clothing is expecting to pay an annual dividend per share of $0.55 out of annual earnings per share of $4.75. Currently, Rubenstein Bros.' stock is selling for $19.00 per share. Adhering to the company's target capital structure, the firm has $13 million in total invested capital, of which 50% is funded by debt. Assume that the firm's book value of equity equals its market value. In past years, the firm has earned a return on equity (ROE) of 19%, which is expected to continue this year and into the foreseeable future.
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