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Two online magazine companies reported the following in their financial statements: Net income Total stockholders' equity Earnings per share Stock price when annual results reported
Two online magazine companies reported the following in their financial statements: Net income Total stockholders' equity Earnings per share Stock price when annual results reported Betterworth 2018 2017 $105,000 $107,604 537,186 462,814 1.802 .19 51.90 48.54 Outdoor Fun 2018 2017 $ 85,500 $171,173 397,151 417,049 1.10 2.98 30.05 57.20 Required: 1-a. Compute the 2018 ROE for each company. 1-b. Which company appears to generate greater returns on stockholders' equity in 2018? 2-a. Compute the 2018 P/E ratio for each company. 2-b. Which company do investors appear to value more
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