Home Depot shares are currently selling for $136 per share.Next year's dividend is expected to be $3.31; next year's earnings per share are expected to be $6.55.Home Depot's P/E ratio is [blank].

Question

Quizplus · Accepted Answer

The P/E ratio can be calculated by dividing the current stock price by the expected earnings per share.

P/E ratio = Stock price / Earnings per share

Plugging in the given values:

P/E ratio = $136 / $6.55 = 20.75

Therefore, the best choice is C) 20.75 as it correctly calculates the P/E ratio.

Home Depot Shares Are Currently Selling for $136 Per Share