Business, 19.12.2019 06:31 yurlgurllmay

Campbell corporation is evaluating an extra dividend versus a share repurchase. in either case, $16,000 would be spent. current earnings are $2.00 per share, and the stock currently sells for $50 per share. there are 2,500 shares outstanding. ignore taxes and other imperfections.
a. evaluate the two alternatives in terms of the effect on the price per share of the stock and shareholder wealth per share. (do not round intermediate calculations and round your answers to 2 decimal places, e. g., 32.16.)
alternative i extra dividend
price per share $ 43.60
shareholder wealth $ 50
alternative ii repurchase
price per share $ 50
shareholder wealth $ 50
b. what will the company's eps and pe ratio be under the two different scenarios? (do not round intermediate calculations and round your answers to 2 decimal places, e. g., 32.16.)

Answers: 2

Show answers

Other questions on the subject: Business

Business, 21.06.2019 17:20, dixks

The following extract was taken from the worksheet of special events bakers for the year 2019. special events bakers worksheet december 31, 2019 account names cash equipment accumulated depreciation minus− equipment unadjusted trial balance debit credit $ 6 comma 800$6,800 15 comma 20015,200 $ 8 comma 500$8,500 adjusted trial balance debit credit $ 6 comma 800$6,800 15 comma 20015,200 $ 10 comma 000$10,000 for the above information, determine the amount of depreciation expense for the equipment used in the business

Answers: 3

continue

Business, 22.06.2019 14:30, 20guadalupee73248

The face of a company is often that of the lowest paid employees who meet the customers. select one: true false

Answers: 1

continue

Business, 22.06.2019 16:00, hany90

Arnold rossiter is a 40-year-old employee of the barrington company who will retire at age 60 and expects to live to age 75. the firm has promised a retirement income of $20,000 at the end of each year following retirement until death. the firm's pension fund is expected to earn 7 percent annually on its assets and the firm uses 7% to discount pension benefits. what is barrington's annual pension contribution to the nearest dollar for mr. rossiter? (assume certainty and end-of-year cash flows.)

Answers: 2

continue

Business, 22.06.2019 17:10, alexwlodko

Storico co. just paid a dividend of $3.15 per share. the company will increase its dividend by 20 percent next year and then reduce its dividend growth rate by 5 percentage points per year until it reaches the industry average of 5 percent dividend growth, after which the company will keep a constant growth rate forever. if the required return on the company’s stock is 12 percent, what will a share of stock sell for today?

Answers: 1

continue

You know the right answer?

Campbell corporation is evaluating an extra dividend versus a share repurchase. in either case, $16,...