Case summary:
Person C and Person GR are the founders and owners of R Company. This company manufactures and installs heating, ventilation, and cooling units (HVAC) commercially. Both the owners have 50,000 shares of the company’s stock as per the
R Company has $3.75 earnings per share and the dividends of $48,000 each were paid to the owners of the company. Moreover, there is even
Characters in the case:
R Company: The firm that wants to value their stocks.
Person C: Co-owner of Company R.
Person GR: Co-owner of Company R.
To determine: The future return on equity (ROE)
Introduction:
ROE measures the profitability of the company by indicating the profit generated from the money invested by the shareholders.
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