asked 123k views
1 vote
The following information was available for the year ended December 31, 2022: Dividends per share 1.30 Earnings per share 3.00 Market price per share at year-end 26.70 Required: Calculate the price/earnings ratio for 2022. Note: Round your answer to 2 decimal places. Calculate the dividend payout ratio for 2022. Note: Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34). Calculate the dividend yield for 2022

1 Answer

2 votes

Final answer:

The price/earnings ratio for 2022 is 8.90, the dividend payout ratio is 43.33%, and the dividend yield is 4.87%, demonstrating the stock's profitability and income return to shareholders.

Step-by-step explanation:

You have asked how to calculate the price/earnings ratio, the dividend payout ratio, and the dividend yield for the year ended December 31, 2022. Here are the calculations using the information provided:

  • Price/Earnings (P/E) Ratio: To calculate the P/E ratio, you divide the market price per share by the earnings per share (EPS). So, for 2022, the calculation would be "26.70 / 3.00", which gives a P/E ratio of approximately 8.90.
  • Dividend Payout Ratio: This ratio is calculated by dividing the dividends per share by the earnings per share. The calculation is "1.30 / 3.00", resulting in a dividend payout ratio of 43.33%.
  • Dividend Yield: To calculate the dividend yield, divide the dividends per share by the market price per share at year-end. The calculation is "1.30 / 26.70", resulting in a dividend yield of 4.87%.

These calculations are helpful for understanding a company's stock performance in terms of its profitability, how much income it returns to shareholders, and the yield of dividend income relative to stock price.

answered
User Kineolyan
by
8.1k points

No related questions found

Welcome to Qamnty — a place to ask, share, and grow together. Join our community and get real answers from real people.