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Web Cites Research projects a rate of return of 10% on new projects. Management plans to plow back 20% of all earnings into the firm.
Web Cites Research projects a rate of return of 10% on new projects. Management plans to plow back 20% of all earnings into the firm. Earnings this year will be $3 per share, and investors expect a rate of return of 5% on stocks facing the same risks as Web Cites a. What is the sustainable growth rate? (Enter your answer as a whole percent.) Sustainable growth rate 2 b. What is the stock price? (Do not round intermediate calculations. Round your answer to 2 decimal places.) $ 81.60X Stock price c. What is the present value of growth opportunities (PVGO)? (Do not round intermediate calculations. Round your answer to 2 decimal places.) $ 33.60 X PVGO d. What is the P/E ratio? (Do not round intermediate calculations. Round your answer to 2 decimal places.) 27.20X P/E ratio
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