Answer to Question #98036 in Finance for Amanda

Question #98036
Sandhill Co. just paid a dividend of $2.45 per share and its EPS is $17.15. Its book value per share (BVPS) is $120.05. Calculate Sandhill’s sustainable growth rate.
1
Expert's answer
2019-11-08T06:01:17-0500

Earning per share (EPS)= $17.15

Just paid dividend per share (DPS)= $2.45

Book value per share= $120.05


Payout ratio


Plow-back ratio = 1-Payout ratio


Sustainable growth rate= Plow-black ratio*(EPS/Book value per share)

Sustainable growth rate 12.28%

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