The M. Smith and Family CorporationDataShares Outstanding25,000,000Earnings$50,000,000Dividends, Per Share (Just Paid)$1.25 Return on Equity0.15Beta1.35 Market DataExpected ReturnMarket Return0.12Risk-Free Rate0.03 Required: Using the information in the tables above, complete the necessary steps to calculate the P/E ratio and the PEG ratio.The M. Smith and Family CorporationCalculationsCapitalization Rate Earnings Per Share Plowback Rate Sustainable Growth Rate Price P/E Ratio Sustainable Growth Rate (as Percentage, use for PEG Calculation)0PEG Ratio

P/E ratio is one of the important factor for comparing the stock and valuation of stock for…

Answered: M. Smith and Family Corporation Data…

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter17: Financial Statement Analysis

Section: Chapter Questions

Problem 4AP

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The M. Smith and Family Corporation	Data
Shares Outstanding	25,000,000
Earnings	$50,000,000
Dividends, Per Share (Just Paid)	$1.25
Return on Equity	0.15
Beta	1.35

Market Data	Expected Return
Market Return	0.12
Risk-Free Rate	0.03

Required:
Using the information in the tables above, complete the necessary steps to calculate the P/E ratio and the PEG ratio.

The M. Smith and Family Corporation	Calculations
Capitalization Rate
Earnings Per Share
Plowback Rate
Sustainable Growth Rate
Price
P/E Ratio
Sustainable Growth Rate (as Percentage, use for PEG Calculation)	0
PEG Ratio

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