Required a. Using the given data, calculate items 1 through 8 below for 2016. Compare the performance of Packard Plastics, Inc., with the following industry averages and comment on its operations. Round all answers to two decimal places. Median Ratios for Manufacturers of Plastic and Ratios for Synthetic Products Packard Plastics 1. Quick ratio: 1.20 0.85 v 2. Current ratio: 1.90 2.62 v 3. Accounts Receivable Turnover: 7.90 12.91 v 4. Inventory turnover: 7.80 3.75 v 5. Debt-to-equity ratio: 1.09 v 0.95 32.70 % 34.55 v % 6. Gross profit percentage 7. Return on sales 3.50 % 6.12 v % 8. Return on assets: 6.30 % 11.89 v % b. Calculate the dividends paid per share of common stock. (Note: Number of shares shown on balance sheet is not shown in thousands. The number of shares "in thousands" is 12,500.) Round answers to two decimal places. S 1.2 What was the dividend payout ratio? 4.04 c. If the most recent price per share of common stock is $50.25, what is the price-earnings ratio? Round answers to two decimal places. 11.82 The dividend yield? x % Check
Dividend Valuation
Dividend refers to a reward or cash that a company gives to its shareholders out of the profits. Dividends can be issued in various forms such as cash payment, stocks, or in any other form as per the company norms. It is usually a part of the profit that the company shares with its shareholders.
Dividend Discount Model
Dividend payments are generally paid to investors or shareholders of a company when the company earns profit for the year, thus representing growth. The dividend discount model is an important method used to forecast the price of a company’s stock. It is based on the computation methodology that the present value of all its future dividends is equivalent to the value of the company.
Capital Gains Yield
It may be referred to as the earnings generated on an investment over a particular period of time. It is generally expressed as a percentage and includes some dividends or interest earned by holding a particular security. Cases, where it is higher normally, indicate the higher income and lower risk. It is mostly computed on an annual basis and is different from the total return on investment. In case it becomes too high, indicates that either the stock prices are going down or the company is paying higher dividends.
Stock Valuation
In simple words, stock valuation is a tool to calculate the current price, or value, of a company. It is used to not only calculate the value of the company but help an investor decide if they want to buy, sell or hold a company's stocks.
Need help finding the dividend payout ratio and the dividend yield. Please provide your formula for figuring this out so I am take notes on how to do these kinds of problems.
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