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B&B Corporation is evaluating an extra dividend versus a share repurchase. In either case, $15,000 would be spent. Current earnings are $2.60 per share, and
B&B Corporation is evaluating an extra dividend versus a share repurchase. In either case, $15,000 would be spent. Current earnings are $2.60 per share, and the stock currently sells for $70 a share. Evaluate the two alternatives in terms of the effect on the price per share of the stock and shareholder wealth. Dividend or share re-purchase, do not change shareholder wealth. It is not going to change the price of share, dividend price will go down
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