Shatin Intl. has 9.9 million shares, an equity cost of capital of 12.7% and is expected to pay a total dividend of $19.4 million each year forever. It announces that it will increase its payout to shareholders. Instead of increasing its dividend, it will keep it constant and will start repurchasing $10.2 million of stock each year as well. What is your estimate of Shatin's stock price after this announcement? The stock price will be $ (Round to the nearest cent.) sak rsion his s eful E KShatin Intl. has 9.9 million shares, an equity cost of capital of 12.7% and is expected to pay a total dividend of $19.4million each year forever. It announces that it will increase its payout to shareholders. Instead of increasing its dividend,it will keep it constant and will start repurchasing $10.2 million of stock each year as well. What is your estimateof Shatin's stock price after this announcement?The stock price will be $(Round to the nearest cent.)akrsionhis seful t

Name: Shatin Intl. has 9.9 million shares, an equity cost of capital of 12.7
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Description: Shatin Intl. has 9.9 million shares, an equity cost of capital of 12.7% and is expected to pay a total dividend of $19.4 million each year forever. It announces that it will increase its payout to shareholders. Instead of increasing its dividend, it

Future value of total dividend = $19.4 millionRepurchasing stock = $10.2 millionEquity cost of…

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Shatin Intl. has 9.9 million shares, an equity cost of capital of 12.7% and is expected to pay a total dividend of $19.4 million each year forever. It announces that it will increase its payout to shareholders. Instead of increasing its dividend, it will keep it constant and will start repurchasing $10.2 million of stock each year as well. What is your estimate of Shatin's stock price after this announcement? The stock price will be $ (Round to the nearest cent.) sak rsion his s eful E

Shatin Intl. has 9.9 million shares, an equity cost of capital of 12.7% and is expected to pay a total dividend of $19.4 million each year forever. It announces that it will increase its payout to shareholders. Instead of increasing its dividend, it will keep it constant and will start repurchasing $10.2 million of stock each year as well. What is your estimate of Shatin's stock price after this announcement? The stock price will be $ (Round to the nearest cent.) sak rsion his s eful E

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 2P

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