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vodomira [7]
3 years ago
12

Kellogg Co. (K) recently earned a profit of $2.22 earnings per share and has a P/E ratio of 19.35. The dividend has been growing

at a 6 percent rate over the past few years. If this growth rate continues.
Required:
a. What would be the stock price in four years if the P/E ratio remained unchanged?
b. What would the price be if the P/E ratio declined to 16 in four years?
Business
1 answer:
shutvik [7]3 years ago
7 0

Answer and Explanation:

The computation is shown below:

The following formula should be used

= P/E ratio × EPS × (1 + growth rate)^n umber of years

a. The stock price in four years is

= $19.35 × $2.22 × (1 + .06)^4

= $54.23

b. The stock price in four years in the case when the P/E ratio fall to 16

= $16 × $2.22 × (1 + .06)^4

= $44.84

We simply applied the above formula so that the correct price could come

And, the same is to be considered

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Explanation:

Aggregate planning is concerned with forecasting the needs operational needs of an organization and making provisions for them ahead of time.

Aggregate planners develop, analyze, and draft an estimated schedule of the overall operations of an organization.

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Answer: Please check in the explanation column for answer

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7 0
2 years ago
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<h3>What is ICD 10-CM?</h3>

It should be noted that ICD 10-CM simply refers to the international classification of diseases.

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1 year ago
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