If future earnings are expected to be higher than current earnings (that is, growth in earnings is expected), the P/E will be low. ( )
举一反三
- Earnings per share (EPS) represents current earnings while price to earnings ratio represents future earnings.
- Transitory earnings are current earnings that are likely to be maintained in the future. ( )
- A company retains 50%of its earnings for capital investment project and the firm is expected to divest itself of unrelated divisions. As a result of the divestment, the return on equity is expected to increase from 20% to 30%. So, what is the growth rate a
- A P/E ratio considers _____ A: profits relative to earnings B: price of the stock relative to earnings C: price of a preferred stock relative to earnings D: profits relative to equity
- Company A is considering making a bid for 100% of Company B’s equity capital. Company B has a P/E ratio of 14 and earnings of $500m. It is expected that $150m in synergy savings will be made as a result of the takeover and the P/E ratio of the combined com