Question
(Stock repurchases and earnings per share) CareMore, Inc. provides in-home medical assistance to the elderly and earned net income of $4.7 million that it plans
(Stock repurchases and earnings per share)
CareMore, Inc. provides in-home medical assistance to the elderly and earned net income of $4.7 million that it plans to use to repurchase shares of the firm's common stock, which is currently selling for $46 a share. CareMore has 15 million shares of stock outstanding.
a. What fraction of the firm's shares can the firm repurchase for $4.7 million?
b. If the share repurchase has no impact on the firm's net income, what will be its earnings per share after the repurchase?
a. What fraction of the firm's shares can the firm repurchase for $4.7 million?
% (Round to two decimal places.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started