Question
Your company you feel is undervalued, the current share price is $25 per share, but you feel that $30 is the correct price. Assuming you
Your company you feel is undervalued, the current share price is $25 per share, but you feel that $30 is the correct price. Assuming you are correct and that tomorrow the whole world will agree that the correct price yesterday should have been $30 per share, you are considering repurchasing shares now when they are undervalued. The firm has 20 million shares outstanding and no debt, but the firm does have 150 million in cash owned by the firm
5) What will be the share price be tomorrow if you repurchased shares today at the current market value?
6) What will be the share price be tomorrow if you repurchased shares tomorrow at the new perceived market value?
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Finance And Financial Markets
Authors: Keith Pilbeam
4th Edition
1137515627, 978-1137515629
