You have found the following stock quote for RJW Enterprises, Inc., in the finan

Question

You have found the following stock quote for RJW Enterprises, Inc., in the financial pages of today’s newspaper. YTD %Chg -1.1 Stock: RJW Enterp SYM : RJW YLD: 2.0 PE: 15 Last: 85.00 NET CHANGE .17 What is the annual dividend?$ ____ (Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16)) What was the closing price for this stock that appeared in yesterday’s paper?$____ (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) If the company currently has 20 million shares of stock outstanding, what was net income for the most recent four quarters? $____ (Enter your answer in dollars, not millions of dollars. Do not round intermediate calculations and round your final answer to the nearest whole number. (e.g., 32))

Explanation / Answer

Dividend yield = dividend/Stock Price =d1/Po

Technically, we require the next year’s dividends, but let’s assume the dividend is constant

2%=d1/85 = 85*.02=1.70

dividend =$1.70

What was the closing price for this stock that appeared in yesterday’s paper?

=85+.17 =85.17

If the company currently has 20 million shares of stock outstanding, what was net income for the most recent four quarters?

P/E = 15 = Stock price / EPS = $85 / EPS

EPS =85/15 =5.67

Net Income =20,000,000*5.67 =113,400,000

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