Question
The market consensus is that Analog Electronic Corporation has an ROE = 12%, has a beta of 1.55, and plans to maintain indefinitely its traditional
The market consensus is that Analog Electronic Corporation has an ROE = 12%, has a beta of 1.55, and plans to maintain indefinitely its traditional plowback ratio of 2/5. This year's earnings were $2.40 per share. The annual dividend was just paid. The consensus estimate of the coming year's market return is 16%, and T-bills currently offer a 6% return. |
a. | Find the price at which Analog stock should sell. (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.) |
Price | $ |
b. | Calculate the P/E ratio. (Do not round intermediate calculations. Round your answers to 2 decimal places.) |
P/E Ratio | |
Leading | |
Trailing | |
c. | Calculate the present value of growth opportunities. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.) |
PVGO | $ |
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