320 78 361 $ 841 2009 2010 2009 2010 1,580 1,560 490 740 3,280 3,770 $ 6,020 $ 6

Question

320

78

361

$ 841

  

2009

2010

2009

2010

1,580

1,560

490

740

3,280

3,770

$ 6,020

$ 6,405

$ 6,020

$ 6,405

  

Windswept, Inc. has 330 million shares of stock outstanding. Its price-earnings ratio for 2010 is 24. What is the market price per share of stock?

Windswept, Inc. 2010 Income Statement ($ in millions) Net sales $ 9,050 Less: Cost of goods sold 7,450 Less: Depreciation

320

Earnings before interest and taxes $ 1,280 Less: Interest paid

78

Taxable Income $ 1,202 Less: Taxes

361

Net income

$ 841

Explanation / Answer

$61.16

EPS = Net income-Preferred dividends/Total shares = 841 - 0 /330 = 2.54

No information is given regarding preferred stock

P/EPS = 24

P = 24 *2.54 = $61.16

Related Questions

Navigate

• Browse (All)
• Browse 3
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.