You printed a stock price quote for Dell, but unfortunately, spilled coffee on i
ID: 2775577 • Letter: Y
Question
You printed a stock price quote for Dell, but unfortunately, spilled coffee on it and now need to restore the missing pieces of information. What is the Dell's P/E ratio? What is Dell's dividend yield? If you want to buy 100 shares, how much will you have to pay? If you bought a share of Dell a year at $ 17.30 and sell it now, what your capital gains/losses are? What is your total return? What is the Dell's P/E ratio? What is Dell's dividend yield? If you want to buy 100 shares, how much will you have to pay? If you bought a share of Dell a year ago at $ 17.30 and sell it now, what your capital gains/losses are? What is your total return?Explanation / Answer
a)
P/E ratio = market price / EPS
=14.33/1.35
= 10.615 times
b)
Dividend yield = Dividend per share / Price per share
= 0.32/ 14.33
=2.23%
c)
Stocks to buy =100
Stock price = 14.33
Price to pay = 100 x14.33 = 1,433
d)
Price received = 14.33
Capital gain = (Selling price – buying price)/ Buying price
= (14.33 -17.30)/17.30
=-17.17%
Hence there is capital loss.
Return = Capital gain yield + Dividend yield
=-17.17%+2.23%
=-14.94%
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