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Stock investing

Student's Name

Institution Name

Instructor Name

Course Name

Date
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Stock investing

a) Fill out the following table for both companies

Buick Dodge

Summary of the An American car Dodge, manufactured

Company Buick brand, Buick is a sub-brand in Auburn Hills, Michigan, is

of GM (GM). David Dunbar a branch of the American

Buick founded the firm in automaker Stellantis. The

1899, and it was one of the Dodge brand has a rich

earliest American car brands history of producing high-

and the foundation of General performance automobiles,

Motors from 1908.. and for many years, Dodge

was Chrysler's middle-priced

brand, sitting above

Plymouth. The U.S. city of

Detroit, Michigan.

Forward P/E 18.57%

Forward annual 0.00% 8.52%

Dividend Yield

Operating margin 10.62% 16.50%

b) What do these ratios tell you about each company?

Divide the present value of the share by the earnings per share forecast for the next 12

months to get the forward P/E ratio. The potential to create profit for common shareholders is
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reflected in an increased EPS ratio. So, Dodge higher future P/E suggests that the company can

generate profits and increase shareholder returns. After deducting the cost of labor and materials

from total production costs, but before deducting other operating expenses like interest and taxes,

a business can calculate its operating margin. From this data, it can be concluded that Dodge is

the most profitable corporation due to its higher profit margins per dollar of sales. An estimate of

dividends paid for the next year, stated as a percentage of the current stock price, is known as the

forward annual dividend yield. Because of this, Buick is giving its stockholders less of the

company's profits.

c) Which one of the two companies would you invest in and why?

I think Dodge is a good investment. Compared to Buick, Dodge has a more excellent

future P/E ratio and a better operating margin (almost 10%). Dodge has a more significant

potential to make money and get it into shareholders' pockets and is making a more substantial

profit on each dollar compared to Buick. Thus I would be compelled to invest in their firm

despite its lower forward dividend yield and lesser payments to shareholders. In every respect,

Dodge outshines Buick, as an investor, I would much prefer to put my money into Dodge, where

I'd benefit from the company's higher forward P/E and greater earnings per share (EPS) than

Buick, which pays out less in dividends.