Assume that the following quote for the Walt Disney Company, a NYSE stock, appea
ID: 2817934 • Letter: A
Question
Assume that the following quote for the Walt Disney Company, a NYSE stock, appeared on May 1, 2015 (Friday) on Yahoo! Finance (http://finance.yahoo.com/q?s=DIS&ql=1):
Given this information, answer the following questions.
At what price did the stock sell at the time of the quote?
$
What is the stock's price/earnings ratio?
What does that indicate? Round your answers to the nearest whole number.
This means that investors are willing to pay more than $ for every $1 of earnings per share that the company generated last year.
What is the last price at which the stock traded on the prior trading day?
$
What's the stock's dividend yield?
%
What are the highest and lowest prices at which the stock traded during the latest 52-week period?
How large is the market capitalization of the company?
$ billion
Explanation / Answer
At what price did the stock sell at the time of the quote?
$ 110.52
What is the stock's price/earnings ratio?
24.57 ttm
The PE ratio helps investors analyze how much they should pay for a stock based on its current earnings. This is why the price to earnings ratio is often called a price multiple or earnings multiple. Investors use this ratio to decide what multiple of earnings a share is worth. In other words, how many times earnings they are willing to pay.
This means investors are willing to pay $24.57 for every $1 of earnings per share that the company generated last year.
What is the last price at which the stock traded on the prior trading day?
$ 108.72
What's the stock's dividend yield?
1.15 (1.10%)
What are the highest and lowest prices at which the stock traded during the latest 52-week period?
Highest - $ 111.66
Lowest - $ 78.54
How large is the market capitalization of the company?
$ 187.84 billion
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