Interpret Valuation Ratios
Series 65 · Flashcards · Application
SERIES 65 · FLASHCARDS
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QUESTION
Calculate BVPS when common equity is
500
million
500\text{ million}
500
million
and shares are
100
million
100\text{ million}
100
million
.
QUESTION
Calculate equity when debt-to-equity is
1.5
1.5
1.5
and total liabilities are
150
150
150
.
QUESTION
Calculate EPS when price is
60
60
60
and P/E is
15
15
15
.
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ANSWER
4
4
4
. EPS is derived by dividing the share price by the P/E ratio, resulting in $4 as the earnings per share implied by the valuation.
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