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Red Corp. is evaluating an extra dividend versus a share repurchase. In either case, $6,000 would be spent. Current earnings are $0.81 per share and
Red Corp. is evaluating an extra dividend versus a share repurchase. In either case, $6,000 would be spent. Current earnings are $0.81 per share and the stock currently sells for $36 per share. There are 1,800 shares outstanding. Ignore taxes and other imperfections. If Red Corp. pays a dividend, what will be the dividend per share? After the dividend is paid, how many shares will be outstanding and what will the price per share be? Enter your answers rounded to 2 DECIMAL PLACES. NOTE: Fractional shares are possible (Ex. 0.39 shares) Dividend = 3.33 Correct response: 3.330.01 Shares outstanding = 6000 Correct response: 1,800 Stock price = 32.67 Correct response: 32.670.01 Click "Verify" to proceed to the next part of the question. After the $3.33 dividend, the price falls to $32.67 per share. What are earnings per share (EPS) and the price earnings (P/E) ratio? Enter your answers rounded to 2 DECIMAL PLACES. EPS=0.81 Correct response: 0.81 P/E Ratio=40.33 Correct response: 40.330.1 Click "Verify" to proceed to the next part of the question. If Red Corp. goes with the share repurchase, how many shares will they buy? After the repurchase, how many shares will be outstanding and what will the price per share be? Enter your answers rounded to 2 DECIMAL PLACES. Shares repurchased = Number Shares outstanding = Number Stock price Number Click "Verify" to proceed to the next part of the
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