Problem 6-26 The current price of Parador Industries stock is $84 per share. Cur
ID: 2638376 • Letter: P
Question
Problem 6-26
The current price of Parador Industries stock is $84 per share. Current sales per share are $15.4, the sales growth rate is 8.5 percent, and Parador does not pay a dividend. The expected return on Parador stock is 15 percent.
Calculate the sales per share one-year ahead. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
Calculate the P/S ratio one-year ahead. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
The current price of Parador Industries stock is $84 per share. Current sales per share are $15.4, the sales growth rate is 8.5 percent, and Parador does not pay a dividend. The expected return on Parador stock is 15 percent.
Explanation / Answer
The current price of Parador Industries stock is $84 per share. Current sales per share are $15.4, the sales growth rate is 8.5 percent, and Parador does not pay a dividend. The expected return on Parador stock is 15 percent.
Calculate the sales per share one-year ahead. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
The sales per share one-year ahead = 15.40*1.085 = 16.71
Calculate the P/S ratio one-year ahead. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
P/S Ratio = 84/15.40 = 5.45
1.Calculate the sales per share one-year ahead. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
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