How do you calculate price/earnings ratio with dividends?

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How do you calculate price/earnings ratio with dividends?

If the price of a stock is $50 per share, earnings are $10 per share and dividends are $10 a share. What is the yield and how do I figure this out?

2007-09-19 18:53:27 · 2 answers · asked by Anonymous in Business & Finance ➔ Other - Business & Finance

2 answers

If the earnings is after paying the dividends, you have to regross the earnings with the dividends amt. In this case, the true earnings are $20 per share. P/E ratio is Market value per share/Earnings per share = 50/20 = 2.5

2007-09-20 00:08:32 · answer #1 · answered by Sandy 7 · 0⤊ 0⤋

The dividends are irrelevant. If earnings are $10 and the stock price is $50, the P/E Ratio is 5

2007-09-19 18:58:03 · answer #2 · answered by Anonymous · 0⤊ 0⤋