Katsenelson assigns 0.65 P/E points per percent of EPS growth with the exception of decimals which are always rounded down; (e.g. 1.47 → 1). An EPS growth rate in excess of 16% receives 0.5 P/E points for each percent exceeding this mark. Conversely, dividends are tangible and accessible capital; hence, a higher point attribution due to greater liquidity. One P/E point is designated for every percent of dividend yield manifesting a clear linear relationship as postulated within the following chart published in Katsenelson’s book Active Value Investing: Making Money in Range-Bound Markets.
-Remember decimals are always rounded down; (e.g. 2.43 → 2, 2.67 → 2.5)
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