What is the firm value after the repurchase

Assignment Help Financial Management

Reference no: EM131901992

You are employed in the Finance Division of a firm that has 321,570,000 shares outstanding.The current share price is $47.62. The forecast earnings are $1,057,760,000.

Calculate the current market value of firm equity and the earnings per Share (EPS).

The firm has accumulated a stockpile of $1,500,000,000 in excess cash, and the directors want to pay-out these funds to the shareholders. You have been asked to compare the effects of a special one-time dividend and a share repurchase.

If the funds are paid out as a one-time dividend, what will be the (special) dividend per share(DPS)? What is the firm value after the dividend? What is the share price after the dividend?What is the EPS after the dividend?

If the firm executes a share repurchase, how many shares will be purchased at what price? How many shares will remain? What is the firm value after the repurchase?

What is the share price after the repurchase? What is the EPS after the repurchase?

Reference no: EM131901992

Questions Cloud

What is the effective tax rate and before-tax equivalent : What is the effective tax rate and before-tax equivalent yield? How would you evaluate the tax benefits of this investment?

Compute weighted average shares of common stock for the year : Compute weighted average shares of common stock for the year, basic EPS, and diluted EPS. Write the EPS formula. Show all computations used in your solution.

Find the annual cost of ordering and holding inventory : XYC Co. purchases an item. The annual demand for this item is 30000 units. The ordering cost is $80 per order. The holding cost is $15 per unit per year.

Why is another depression like the great depression : Why is another depression like the Great Depression of the 1930s not likely to occur?

What is the firm value after the repurchase : If the firm executes a share repurchase, how many shares will be purchased at what price? How many shares will remain?

What does over-leveraged mean : What does over-leveraged mean? How does this put an organization at a disadvantage? What are the advantages of leveraging the assets of an organization?

How investment depends on the real interest rate : On an r vs. I diagram, sketch a curve showing how investment depends on the real interest rate, based on our "Investment function", In().

Describe what a stock market bubble is : Which type of index better reflects the changes in the economy's wealth, price weighted or valueweighted? Why?

Compute the labor price and quantity variances : Compute the labor Price and Quantity Variances. Compute the labor rpice and quantity variances, assuming the standard is 3.3 hours of firect labor.

User Account

All Pages