fm4 19 - = $1,977,152/250,000 = $7.91. Market/Book = Market...

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Mini Case: 4 - 19 f. Calculate the 2008 price/earnings ratio, price/cash flow ratios, and market/book ratio. Do these ratios indicate that investors are expected to have a high or low opinion of the company? Answer: EPS = Net Income/Shares Outstanding = $253,584/250,000 = $1.0143. Price/Earnings 08 = Price Per Share/Earnings Per Share = $12.17/$1.0143 = 12.0 × . Check: Price = EPS × P/E = $1.0143(12) = $12.17. Cash Flow/Share 08 = (NI + DEP)/Shares = ($253,584 + $120,000)/250,000 = $1.49. Price/Cash Flow = $12.17/$1.49 = 8.2 × . BVPS = Common Equity/Shares Outstanding
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Unformatted text preview: = $1,977,152/250,000 = $7.91. Market/Book = Market Price Per Share/Book Value Per Share = $12.17/$7.91 = 1.54x. Both the P/E ratio and BVPS are above the 2006 and 2007 levels but below the industry average. g. Perform a common size analysis and percent change analysis. What do these analyses tell you about Computron? Answer: For the common size balance sheets, divide all items in a year by the total assets for that year. For the common size income statements, divide all items in a year by the sales in that year....
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This note was uploaded on 07/13/2011 for the course FIN 4414 taught by Professor Staff during the Spring '08 term at University of Florida.

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