Joker stock has a sustainable growth rate of 10 percent, ROE of 16 percent, and dividends per share of $3.20. If the PE ratio is 15.7,what is the value of a share of stock?Note: Do not round intermediate calculations. Round your answer to 2 decimal places.Stock value per share

$55.82.Explanation:1. Calculate the earnings per share (EPS):We can use the sustainable growth rate…

Answered: Joker stock has a sustainable growth…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Joker stock has a sustainable growth rate of 10 percent, ROE of 16 percent, and dividends per share of $3.20. If the PE ratio is 15.7, what is the value of a share of stock? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Stock value per share