What will happen to the book value per share

Reference no: EM13300156

The Metallica Heavy Metal Mining (MHMM) Corporation wants to diversify its operations. Some recent financial information for the company is show here;

Stock price $73
Number of shares 45,000
Total Assets $6,500,000
Total Liabilities $2,600,000
Net Income $630,000

MHMM is considering an investment that has the same PE ratio as the firm. The cost if the investment is $1,100,000 and it will be financed with a new equity issue. The return on the investment will equal MHMM's current ROE. What will happen to the book value per share, the market value per share, and the EPS? WHat is the NPV of this investment? Does dilution take place?

Reference no: EM13300156

Questions Cloud

Determine where is the image of the candle : A candle of height 2.0 cm is placed 10.0 cm in front of a diverging (concave) lens of focal length -6.0 cm. Where is the image of the candle

How large is the image of the ant : Suppose you hold a f=5.0 cm magnifying glass 3.0 cm from a 2.0 mm high ant. how large is the image of the ant

Same attributes be equal-regardless of gender : Which of these pieces of legislation requires that initial job offers for jobs with the same attributes be equal, regardless of gender?

Compute the molar mass of an unknown solid : Calculate the molar mass of an unknown solid (assume a non nonelectrolyte) if 1.35 grams of the solid was dissolved in 15.0 grams of dodecanol and caused a freezing point depression of 2.34 degrees Celsius.

What will happen to the book value per share : What will happen to the book value per share, the market value per share, and the EPS? WHat is the NPV of this investment? Does dilution take place?

Where should the film be placed : A camera has a f=50 mm (f=5 cm) lens. A 1.0 mm (0.1cm) tall ant is 200 mm (20 cm) from the lens. Where should the film be placed

Determine the largest mass-m which the frame can carry : The frame is desinged to carry the hanging mass at G equal to 167 kg. The frame is supported by a pin connection at C and the rope AB, and constructed with pin connections at points E, F, and D.

What will the effect be of each of these alternative : What will the effect be of each of these alternative offering prices on the existing price per share?

Regarding performance evaluations : Which of the following is not true regarding performance evaluations in the United States?

User Account

All Pages