1. Review 30 to 60 minutes of financial news programming on television. Take notes on companies that are catching analysts’ attention. You might hear reference to over and undervaluation of firms and to reports about PE ratios, dividend yields, and earnings per share. Be prepared to give a brief description to the class of your observations.
2. Financial information for Nokia Corporation follows.
|
Net income (in millions) |
€ 260 |
|
Cash dividends declared (in millions) |
€ 1,481 |
|
Cash dividends declared per share |
€ 0.40 |
|
Number of shares outstanding (in millions)* |
3,708 |
|
Equity applicable to shares (in millions) |
€14,749 |
Required
1. Compute book value per share for Nokia.
2. Compute earnings per share (EPS) for Nokia.
3. Compare Nokia’s dividends per share with its EPS. Is Nokia paying out a large or small amount of its income as dividends? Explain.