Can you answer these questions for 2 firms total for me? STARBUCKS AND APPLE a.
ID: 2465149 • Letter: C
Question
Can you answer these questions for 2 firms total for me?
STARBUCKS AND APPLE
a. Write the ROE, the number of shares outstanding, the dividends per share, and the net income.
b. Compute the sustainable growth rate (g = b * ROE), where b equals the plowback ratio.
c. Calculate the total amount of dividends paid (dividends * number of shares outstanding), the dividend payout ratio (total dividends paid/net income), and the plowback ratio (1 - dividend payout ratio).
d. What does this information reveal about the ROE for the firms you selected? Be sure to include the link for the financial statements that you select.
Explanation / Answer
Answer- (‘a)
Particulars
Apple
Starbucks
ROE
44.74 %
40.56 %
Number of Shares Outstanding
5,866,161,000
1,485,100,000
Dividend Per Share
$1.98
$0.68
Net Income ( $ in Millions)
53,394
2757.40
http://files.shareholder.com/downloads/AAPL/1753154345x0x861262/2601797E-6590-4CAA-86C9-962348440FFC/2015_Form_10-K_As-filed_.pdf
http://finance.yahoo.com/q/ks?s=SBUX+Key+Statistics
(‘b) Sustainable Growth Rate
Apple
StarBucks
35.01 %
23.64 %
(‘c)
Particulars
Apple
Starbucks
Total Dividends Paid
(Dividends x Number of Shares Outstanding) ( $ in millions)
11,615
1009.87
Dividend Payout Ratio
(Dividend Paid/ Net Income)
21.75 %
41.71 %
Plowback Ratio
78.25 %
58.29 %
(‘d) ROE of apple is more than ROE of Starbucks. It means Apple is generating more return for its shareholders.
The reason for higher ROE is higher net income .
Particulars
Apple
Starbucks
ROE
44.74 %
40.56 %
Number of Shares Outstanding
5,866,161,000
1,485,100,000
Dividend Per Share
$1.98
$0.68
Net Income ( $ in Millions)
53,394
2757.40
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