Question
Shareholders in Sarif Industries require a rate of return on their investment of 11%. Investors expect Sarif to have EPS one year from now of
Shareholders in Sarif Industries require a rate of return on their
investment of 11%. Investors expect Sarif to have EPS one year from now of $4.77. Sarif currently reinvests 28% of its earnings each year and its dividends are expected to grow at an annual rate of 5% in perpetuity.
If shares in Sarif Industries are priced correctly, its P/E ratio will be _________.
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
16th edition
125927716X, 978-1259687969, 1259687961, 978-1259277160
