Answer to Question #19837 in Finance for nas

Question

The XYZ Company has an expected profit margin of 10 percent, turnover ratio of 1.8 and a leverage ratio of 0.30. The leading EPS is $2.50 and the firm uses a dividend payout ratio of 35 percent. The required return on firms with XYZ's risk characteristics is 5 percent. Calculate the expected current stock price of XYZ.