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NEW QUESTION: 1
George Armor, CFA, is a new stock analyst for Pedad Investments. One tool that Pedad uses to compare stock valuations is the dividend discount model (DOM). In particular, the firm evaluates stocks in terms of
"justified" multiples of sales and book value. These multiples are based on algebraic manipulation of the DDM. Over time, these multiples seem to provide a good check on the market valuation of a stock relative to the company's fundamentals. Any stock which is currently priced below its value based on a justified multiple of sales or book value is considered attractive for purchase by Pedad portfolio managers. Exhibit 1 contains financial information from the year just ended for three stable companies in the meat-packing industry: Able Corp, Baker, Inc., and Charles Company, from which Armor will derive his valuation estimates.
One of Pedad's other equity analysts, Marie Swift, CFA, recently held a meeting with Armor to discuss a relatively new model the firm is implementing to determine the P/E ratios of companies that Pedad researches. Swift explains that the model utilizes a cross-sectional regression using the previous year-end data of a group of comparable companies' P/E ratios against their dividend payout ratios (r), sustainable growth rates (g), and returns on equity (ROE). The resulting regression equation is used to determine a predicted P/E ratio for the subject company using the subject company's most recent year-end data. Swift has developed the following model, which has an R-squared of 81%, for the meat packing industry (16 companies):
Predicted P/E = 2.74 + 8.21(r) + 14.21(g) + 2.81(ROE)
(STD error) (2.11) (6.52) (9.24) (2.10)
After Swift presents the model to Armor, she points out that models of this nature are subject to limitations.
In particular, multicollinearity, which appears to be present in the meat packing industry model, can create great difficulty in interpreting the effects of the individual coefficients of the model. Swift continues by stating that in spite of this limitation, models of this nature generally have known and significant predictive power across different time periods although not across different stocks.
Based on Exhibit 1, the justified price-to-sales ratio of Baker, Inc. is closest to:
A. 1.5.
B. 1.9.
C. 1.7.
Answer: C
Explanation:
Explanation/Reference:
Explanation:
The justified price-to-sales (P/S) ratio is calculated as:
P/S = [profit margin X payout ratio X (1 + g)) / (r - g)
Baker: P/S = [(4.80 / 52.80) x (1.60 / 4.80) x (1 + 0.10)] / (0.12 - 0.10) = 1.67 (Study Session 12, LOS 42.j)
NEW QUESTION: 2
Why is quality of service critical to voice network traffic?
A. Voice traffic is bursty in nature.
B. Voice traffic is real-time network traffic.
C. Packets can be resent without affecting conversations.
D. Voice traffic cannot be compressed.
Answer: B
NEW QUESTION: 3
You have an Azure Storage account named storage1 that uses Azure Blob storage and Azure File storage.
You need to use AzCopy to copy data to the blob storage and file storage in storage1.
Which authentication method should you use for each type of storage? To answer, select the appropriate options in the answer area.
NOTE: Each correct selection is worth one point.
Answer:
Explanation:
Explanation:
You can provide authorization credentials by using Azure Active Directory (AD), or by using a Shared Access Signature (SAS) token.
Box 1:
Both Azure Active Directory (AD) and Shared Access Signature (SAS) token are supported for Blob storage.
Box 2:
Only Shared Access Signature (SAS) token is supported for File storage.
Reference:
https://docs.microsoft.com/en-us/azure/storage/common/storage-use-azcopy-v10
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