Alla Bazzter Excursions Co. holds a total in assets of $840,000 but $168,000 of that is excess cash. The firm has 80,000 total shares outstanding and expects $2 million in net income this year. The firm is considering its options with the excess cash, which includes stock buy-back. What will the net effect to the company's earnings-per-share (EPS) if it executes the stock buy back?
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- Tucker’s National Distributing has a current market value of equity of $10,665. Currently, the firm has excess cash of $640, total assets of $22,400, net income of $3,210, and 500 shares of stock outstanding. Tucker’s is going to use all of its excess cash to repurchase sharesof stock. What will the stock price per share be after the stockrepurchase is completed?Tucker’s National Distributing has a current market value of equityof $10,665. Currently, the firm has excess cash of $640, total assetsof $22,400, net income of $3,210, and 500 shares of stock outstanding.Tucker’s is going to use all of its excess cash to repurchase sharesof stock. What will the stock price per share be after the stockrepurchase is completed?Xanadu Corp. is a firm expecting $32 million in net income this year, all of which it plans on distributing to its 400,000 shares outstanding. The company owns $8 million in total assets, but $1 million of that is excess cash. The firm is considering two strategies to disburse the exces cash. The first is to disburse it all to the shareholders as an extra dividend. The second is to execute a stock buyback. If an investor holds 1000 shares before any buyback, what will the capital gains (gain from stock sale) and income (dividend) cash flows be under each strategy?
- Beta Industries has net income of $2,000,000 and it has 1,000,000 shares of common stock outstanding. The company’s stock currently trades at $32 a share. Beta is considering a plan in which it will use available cash to repurchase 20% of its shares in the open market. The repurchase is expected to have no effect on either net income or the company’s P/E ratio. What will be its stock price following the stock repurchase?c) Tucker’s National Distributing has a current market value of equity of $10,665. Currently, the firm has excess cash of $640, total assets of $22,400, net income of $3,210, and 500 shares of stock outstanding. Tucker’s is going to use all of its excess cash to repurchase sharesof stock. What will the stock price per share be after the stockrepurchase is completed?Dana Corporation does not pay a common dividend. Your job is to use the Cash Flow From Assets (CFFA) model to estimate the firm’s intrinsic stock price for December 31, 2023. You are given the following data for that purpose (note that all figures other than WACC are in Millions): What is the Value of Dana Corp.’s Operations, the expected growth rate in Free Cash Flows, and total value of the firm? Dana Corp. Financial Data ($Millions) Year 0 2020 2021 2022 2023 Free Cash Flow (FCF) $ 16.000 $ 16.800 $ 17.640 $ 18.522 Weighted-Average Cost of Capital (WACC) 8.25% Mktbl Securities (Non-Operating ST assets) $ 32.66 Non-Operating LT Assets $ 184.00 Short-term debt $ 52.00 Long-term debt $ 224.00 Preferred Equity $ 46.00 # Common Shares Outstanding (Millions) 15
- Trini Exports has a current market value of equity of $315,000. Currently, the firm has excess cash of $108,000, total assets of $424,000, net income of $113,000, and 3500 shares of stock outstanding. Trini Exports is going to use all of its excess cash to repurchase shares of stock. What will the stock price per share be after the stock repurchase is completed? (Show all workings)See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco repurchases 1.9 million shares each year from 2016 to 2019. What would be its earnings per share in 2019? (Assume Mydeco pays for the shares using its available cash and that Mydeco earns no interest on its cash balances.)The Dunn Corporation is planning to pay dividends of $540000. There are 270000 shares outstanding, and earnings per share are $4. The stock should sell for $48 after the ex-dividend date. If, instead of paying a dividend, the firm decides to repurchase stock,a. What should be the repurchase price? b. How many shares should be repurchased? c. What if the repurchase price is set below or above your suggested price in part a? d. If you own 100 shares, would you prefer that the company pay the dividend or repurchase stock? a. 3/10, net 45 b. 3/15 net 30 c. 3/15 net 60 d.2/10 net 45
- FedEx Corporation (FDX) has a current share price of $157.62 and is expected to have earnings per share (EPS) next year of $11.32 per share. Analysts expect that FedEx's closest competitor, United Parcel Service, Inc. (UPS), will have earnings next year of $8.37 per share. FedEx's cost of capital is 11%. What is your current estimate of the value of one share of UPS stock using the method of comparables? OA. $213.17 OB. $76.09 OC. $13.92 OD. $116.54 OE. $154.67 OF. None of the above is withing $0.35 of the value of one share of UPS stock.Gamma Industries has net income of $3,800,000, and it has1,490,000 shares of common stock outstanding. The company’s stock currently trades at $67a share. Gamma is considering a plan in which it will use available cash to repurchase 10%of its shares in the open market at the current $67 stock price. The repurchase is expectedto have no effect on net income or the company’s P/E ratio. What will be its stock pricefollowing the stock repurchase?FedEx Corporation (FDX) has a current share price of $157.56 and is expected to have earnings per share (EPS) next year of $11.04 per share. Analysts expect that FedEx's closest competitor, United Parcel Service, Inc. (UPS), will have earnings next year of $8.33 per share. FedEx's cost of capital is 11%. What is your current estimate of the value of one share of UPS stock using the method of comparables? OA. $118.88 OB. $208.82 OC. $75.73 OD. $14.27 OE. $154.85 OF. None of the above is withing $0.35 of the value of one share of UPS stock. C