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Dividend cover is 2.4
Dividend yield is 8%
What is price earning ratio?
Correct answer is 5.21, how?PE = MV/EPS = (Divi/0.08) / (2.4 x Divi) = (Divi x 12.5) / (2.4 x Divi)
If you divide top and bottom by Divi, you get PE = 12.5/2.4 = 5.12
market value per share 3.20
dividend cover is 3 and dividend yield 4 %
what is p/e ratioDividend = 4% x 3.20 = 0.128
EPS = 3 x 0.128 = 0.384PE = 3.20 / 0.384 = 8.33
sir kindly explain where u take 12.5 in p/e ratio
dividend yield 8% divided cover 2.4 so how calculate 12.4 ?
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1 divided by 0.08 (dividend yield percentage) is 12.5, and this represents the Market Value in the equation
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well dividend yield is percentage of dividend divided by share price isn’t it?
so the dividend yield is effectively 8/100 or 0.08/1. to find the share price you just flip it so its 1/0.08 or 100/8 which is 12.5 and you use this figure in the P/E equation
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