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paatnguyyen
24.03.2020 •
Business
Patrick is the CFO of Reed Inc. Patrick says that RI earned $13 million last year and maintains a 30% dividend payout ratio. The company has 2 million shares of common stock outstanding and a P/E ratio of 10. What is the dividend yield for RI?
a. 1.50%
b. 2.50%
c. 3.00%
d. 4.50%
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Ответ:
= 3%
Explanation:
Dividend yield is the proportion of a share a price that is earned as dividend. In other words, it is the dividend paid as a percentage of the share price.
Dividend yield = DPS/Share price × 100
The share price can be determined using the P/E ratio as follows:
Share price = P/E × EPS
Earnings per share (EPS) = $13 million/ 2 million
= $6.5 per share
Share price = 10 × $6.5 = $65
Dividend paid (Dividend per share) = Payout ratio × EPS
= 30% × $6.5
= $1.95 per share
Dividend yield = DPS/Share price × 100
= 1.95/65 × 100
= 3%
Ответ:
Yes, your answer graphed is a parallelogram.