Earnings per share

The table below shows the stock price, earnings per share, and dividends per share for three companies for a recent year:

Deere &Co. Price $65.70 earnings per share $4.40 Dividends per share $1.16
Google price $528.33 earnings per share $27.72 Dividends per share $0.00
The Coca-cola Company price $69.05 earnings per share $5.37 Dividends per share $1.88

A. Determine the price-earnings ratio and dividend yield for the three companies. Round to one decimal place.
B. Explain the difference in these ratios across the three companies.

Correct result:

p1 =  14.9
d1 =  1.8 %
p2 =  19.1
d2 =  0 %
p3 =  12.9
d3 =  2.7 %

Solution:

p1=65.704.40=65744=14.9
d1=100 1.1665.70=1160657=1.8%
p2=528.3327.72=160184=19.1
d2=100 0.00528.33=0%
p3=69.055.37=6905537=12.9
d3=100 1.8869.05=2.7%



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