The Ranger Co

question 90

Short Answer

The Ranger Co. earns $4.50 per share. Today, the stock is trading at 42 1/2. The company pays an annual dividend of $.85. Can you calculate (A)the price-earnings ratio (round to whole number)and (B)the yield on the stock?

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Definitions:

Expected Return

The weighted average of all possible returns, with weights equal to the probabilities of each outcome.

Equally-Weighted

An investment strategy where each security is assigned the same weight or importance in a portfolio, promoting diversification.

Risk-Free Asset

An investment with a certain return, usually with low returns, considered to have negligible risk, such as government bonds.

Expected Return

The anticipated value or profit gained from an investment over a specified period, considering all possible outcomes.