The stock of North American Dandruff Company is currently selling at $80 per share. The firm pays a dividend of $2.50 per share.
a. What is the dividend yield?
b. If the firm has a payout rate of 50 percent, what is the firms P/E ratio?
Solution
Problem 18-10
Instructions
Enter formulas to calculate the requirements of this problem.
Information
Stock price$80
Dividend$2.50
a. What is the annual dividend yield?
b. If the firm has a payout rate of 50 percent, what is the firms P/E ratio?