Sustainable growth rate (the maximum growth rate that a firm can sustain without having to increase leverage) is calculated as follows:
ROE x (1 - dividend-payout ratio)
So .13 x (1 - .3) = .091 or 9.1%
(guessing that you meant 13%)
THe answer I gave is 9.1% (which would be a realistic growth rate)
If I take the 13 literally meaning that the company is growing at 13x per year (very unrealistic) then the answer becomes 9.1 (which as a rate means tat the company is growing at 9.1 times itself every year)
The formula is ROE x (1 - dividend-payout ratio) ... and either the 13 is a percentage or not.
Again, if the 13 is ta***** *****terally to mean the company is returning 13 times+ itself every year the answer becomes 9.1 (or expressed as a percentage) 900.1%
Did that get you there?
Would appreciate the feedback