CFA Practice Question

There are 201 practice questions for this study session.

CFA Practice Question

For FPL Group, Inc. (FPL), a utility analyst, forecasts a long-term payout rate of 50 percent, a long-term growth rate of 5 percent, and a required rate of return of 9 percent. Based upon these forecasts of fundamentals, what is FPL's justified trailing P/E?
Correct Answer: Trailing justified P/E is: P/E = (1-0.5)(1+0.05)/(0.09 - 0.05) = 13.125.

User Contributed Comments 0

You need to log in first to add your comment.