Question

In: Finance

Allison & Co. and Bee, Inc. reported the following numbers (in millions) for fiscal year 2014. ...

Allison & Co. and Bee, Inc. reported the following numbers (in millions) for fiscal year 2014.

	Allison & Co.		Bee, Inc.
Net income	$	595.70	$	217.24
Shares outstanding		87.17		57.22
Stock price	$	92.59	$	37.26
Total equity	$	1,738.30	$	959.48

Calculate the earnings per share, market-to-book ratio, and price–earnings ratio for each company. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

	Allison & Co.		Bee, Inc.
Earnings per share	$	times	$	times
Market-to-book ratio		times		times
Price–earnings ratio		times

Expert Solution

	Allison & Co.		Bee, Inc.
Earnings per share	$6.83	Times	$3.80	Times
Market-to-book ratio	4.64	Times	2.22	Times
Price–earnings ratio	13.56	Times	9.80	Times

Explanation;

1.

Earnings per share for Allison & Co.;

Earnings per share = Net income / shares outstanding

Earnings per share = $595.70 / 87.17

Earnings per share = $6.83

Earnings per share for Bee Inc.;

Earnings per share = Net income / shares outstanding

Earnings per share = $217.24 / 57.22

Earnings per share = $3.80

2.

Market-to-book ratio for Allison & Co.;

Market-to-book ratio = Market price per share / Book value per share

Market price per share = $92.59

Book value per share = $1738.30 / 87.17 = $19.94

Market-to-book ratio ($92.59 / $19.94) = 4.64 times

Market-to-book ratio for Bee Inc.;

Market-to-book ratio = Market price per share / Book value per share

Market price per share = $37.26

Book value per share = $959.48 / 57.22 = $16.77

Market-to-book ratio ($37.26 / $16.77) = 2.22 times

3.

Price-earnings ratio for Allison & Co.;

Price-earnings ratio = Market value per share / EPS

Earnings per share = $92.59 / $6.83

Earnings per share = 13.556 or 13.56 times (Approx.)

Price-earnings ratio for Bee Inc.;

Price-earnings ratio = Market value per share / EPS

Earnings per share = $37.26 / $3.80

Earnings per share = 9.805 or 9.80 times (Approx.)

jeff jeffy answered 2 years ago

Barnes & Noble Inc. reported the following financial information for its last fiscal year (all numbers...

Barnes & Noble Inc. reported the following financial information for its last fiscal year (all numbers in thousands): Revenues $6,839,005 Inventory $1,410,769 A/P $1,374,434 A/R $149,369 AAI 105.21 days APP 100.86 days ACP 8.52 days For the upcoming fiscal year B&N management has set a goal for the company to reduce the average age of inventory to 90 days. What would the impact be on the CCC? The CCC will decrease by 25.14 days The CCC will decrease by 15.21...

Best Buy Co Inc. reported the following financial information in a recent financial statement ($ millions)....

Best Buy Co Inc. reported the following financial information in a recent financial statement ($ millions). Based on the information below, compute the additional working capital financing period. Sales …………………………………$50,272 Cost of sales …………………………………37,611 Inventory …………………………………5,897 Accounts receivable …………………………………2,348 Accounts payable …………………………………4,894 La Verne Company reports the sales and collection information below. Assume La Verne Company collects 20 percent of its sales in the month of the sale, 50 percent the next month, 25 percent the following month, and 5...

At the end of last year, Roberts Inc. reported the following income statement (in millions of...

At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars): Sales $3,000 Operating costs excluding depreciation 2,450 EBITDA $550 Depreciation 250 EBIT $300 Interest 124 EBT $176 Taxes (25%) 44 Net income $132 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 5% higher than the $3 billion in sales generated last year. Year-end operating costs, excluding depreciation, are expected to equal 80%...

At the end of last year, Edwin Inc. reported the following income statement (in millions of...

At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars): Sales $4,190.00 Operating costs (excluding depreciation) 3,048.00 EBITDA $1,142.00 Depreciation 325.00 EBIT $817.00 Interest 150.00 EBT $667.00 Taxes (25%) 166.75 Net income $500.25 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 6% higher than $4.19 billion in sales generated last year. Year-end operating costs, excluding depreciation, are expected to increase at the...

A company reported the following numbers for the most recent fiscal year: Revenues $3,000 EBITDA $650...

A company reported the following numbers for the most recent fiscal year: Revenues $3,000 EBITDA $650 DA (Depreciation) $150 EBIT $500 - Interest Expenses $50 Taxable Income $450 Taxes $135 Net Income $315 Payout $157.5 During the year, the company reported capital expenditures of $250 and an increase in net working capital of $40. The tax rate is 30%. Assume that we know the following: • The company’s FCF will grow at 8% per year for the next five years....

eBook At the end of last year, Roberts Inc. reported the following income statement (in millions...

eBook At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars): Sales $3,000 Operating costs excluding depreciation 2,450 EBITDA $550 Depreciation 250 EBIT $300 Interest 124 EBT $176 Taxes (25%) 44 Net income $132 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 11% higher than the $3 billion in sales generated last year. Year-end operating costs, excluding depreciation, are expected to equal...

The flowing numbers come from an equity statement for fiscal year 2011 (in millions): Shareholders’ equity...

The flowing numbers come from an equity statement for fiscal year 2011 (in millions): Shareholders’ equity May 31, 2010 $2,700 Issue of shares for exercise of stock options 405 Repurchase of shares (132) Net income 467 Unrealized loss on debt securities (23) Tax benefit from the exercise of stock options 70 Common dividends paid (250) Preferred dividends paid (10) Shareholders’ equity May 31, 2011 3,227 The firm’s tax rate is 35 percent. Shareholders’ equity at May 31, 2010 includes $120...

Better Burgers reported the following numbers (in millions) for the years ending February 2017 and 2018....

Better Burgers reported the following numbers (in millions) for the years ending February 2017 and 2018. 2017 2018 Net income $ 1,487 Dividends 212 Total assets $ 13,650 12,838 Total equity 6,281 4,564 What are the internal and sustainable growth rates? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) What are the internal and sustainable growth rates using ROE × b and ROA × b and the end of...

Ramon Co reported the following units of production and sales for June and July 2014:

Ramon Co reported the following units of production and sales for June and July 2014: Produced Sold June 2014 100000 90000 July 2014 100000 105000 Net income under absorption costing for June was $40000, net income under variable costing for July was $50000. fixed manufacturing costs were $600000 for each month. Ramon Co uses actual costing. How much was net income for July using absorption costing A. $50000 B $20000 C $80000 D $40000 What is the answer to this...

Retail Co. reported the balance sheet for fiscal year 2015 as follows. Retail Co. Balance Sheet...

Retail Co. reported the balance sheet for fiscal year 2015 as follows. Retail Co. Balance Sheet December 31, 2015 Cash 18,600 Accounts Receivable 33,000 Notes Receivable 10,000 Interest Receivable 600 Merchandise Inventory 22,000 Prepaid Insurance 4,500 Total Current Assets 88,700 Computer Systems: At Cost 78,000 Less Accumulated Depreciation (26,000) Net Computer System 52,000 Total Assets 140,700 LIABILITIES AND SHAREHOLDERS' EQUITY Accounts Payable 36,000 Dividends Payable 1,800 Salaries Payable 6,500 Taxes Payable 10,000 Unearned Revenue 600 Total Liabilities...