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.

What was the closing price for this stock that appeared in yesterday’s paper? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

If the company currently has 35 million shares of stock outstanding, what was net income for the most recent four quarters? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

You have found the following stock quote for RJW Enterprises, Inc., in the financial pages of today’s newspaper.

Explanation / Answer

RJW paid an annual dividend to stockholders= $3.20

The dividend yield is 2.5%.

So RJW’s current stock price:

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

2.5%=$3.2/Po

Therefore, the current price is:

Po=$3.2/0.025

    =$128

The Net Chg of the stock shows the stock decreased by $0.74 on this day, so the closing stock price yesterday was:

Yesterday closing price=$128+$0.74

                                    =$128.74

To find the net income, we need to find the EPS. PE ratio is 15. As we know PE ratio and stock price so EPS:

PE ratio=15

PE=Stock price per share/ EPS

EPS= $128.74/15

      =$8.582667

         EPS is the total net income divided by the number of shares outstanding, so:

`                      

     EPS=$8.582667

     EPS= Net Income/Share out

           =NI/35,000,000 share

NI=35,000,000*8.582667

NI=$300,393,333.33

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