A stock listing contains the following information: P/E 17.5, closing price 33.10, dividend.80, YTD% chg 3.4, and a net chg of -.50. This means that the stock price has increased by 3.4% during the current year and the earnings per share are approximately $1.89. The closing price on the previous trading day was $32.60 and the current yield is 17.5%.

Question

Quizplus · Accepted Answer

The current yield is not 17.5%; the P/E (Price to Earnings) ratio is 17.5. The current yield is calculated by dividing the annual dividend by the current stock price, which would be $0.80 / $33.10 = 0.0242 or 2.42%, not 17.5%.

A Stock Listing Contains the Following Information: P/E 17