Two companies in the transportation industry had the following information:

Company 1Company 2

Basic earnings per share

$0.82 $0.70

Market price per share

$10.94 $22.91

Dividends per share

$0.432 $0.568

Cash flows from operating activities ($ thousands)

$66,433 $228,796

Net capital expenditures ($ thousands)

$6,481 $77,109

1. Calculate the P/E ratios for both companies.

2. Calculate the dividend payout ratio and dividend yield for both companies. Round dividend payout ratio to 1 decimal place

3. Determine the net free cash flows of both companies.