Calculate the return on shareholders equity for ocloud

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Question - OCloud Corporation's suite of software products and services provides secure and scalable solutions for global companies. The following is an extract from the company's 2020 and 2019 comparative income statements and statement of financial position. The market price of OCloud's common shares was $41.12 and $38.20 on June 30, 2020, and June 30, 2019, respectively. OCloud declared dividends per common share of $0.476 and $0.412 for 2020 and 2019, respectively.

OCLOUD CORPORATION Years Ended June 30, 2020, and 2019 (in thousands)

Comparative Income Statement

2020

2019

Total revenues
 

$2,276,557

$1,828,767

Total cost of revenues
 

766,850

569,174

Total operating expenses
 

1,169,419

874,972

Net income*
 

$263,008

$300,221

Statement of Financial Position

2020

2019

Total assets
 

$7,490,691

$5,175,412

Total liabilities
 

3,960,177

3,762,299

Common share capital
 

1,436,263

821,380

Total shareholders' equity
 

$3,530,514

$1,413,113

Weighted average number of commons shares outstanding
 

253,195

242,375

*There are income taxes that do not appear in the list, that would reduce net income.

Required -

Calculate the return on shareholders' equity for OCloud in 2020. Note that OCloud's articles of incorporation authorize only common shares. The average return for the shares listed on the Toronto Stock Exchange in a comparable period was 19.8%.

Calculate earnings per share for the years 2020 and 2019.

Calculate the dividend payout ratio and the dividend yield for 2020 and 2019.

Reference no: EM133170897

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