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Your portfolio is 1,000 shares of Kenney, Inc. The stock currently sells for $64 per share. The company has announced a dividend of $1.15 per
- Your portfolio is 1,000 shares of Kenney, Inc. The stock currently sells for $64 per share. The company has announced a dividend of $1.15 per share with an ex-dividend date of April 19. Assuming no taxes, how much will your stock be worth on April 19?
- Wing Nut Corp (WNC) most recent free cash flow (FCF) was $225 million; the FCF is expected to grow at a constant rate of 3%. The rms WACC is 15%, and it has 9 million shares of common stock outstanding. The rm has $100 million in short-term investments, which it plans to liquidate and distribute to common shareholders via a stock repurchase; the rm has no other non-operating assets. It has $868 million in debt and $60 million in preferred stock.
- What is the value of operations?
- Immediately prior to the repurchase, what is the intrinsic value of equity?
- Immediately prior to the repurchase, what is the intrinsic stock price?
- How many shares will be repurchased? How many shares will remain after the repurchase?
- Immediately after the repurchase, what is the intrinsic value of equity? The intrinsic stock price?
- Bernies Burgers (BB)currently has 420,000 shares of stock outstanding that sell for $94 per share. Assuming no market imperfections or tax effects exist, what will the share price be after:
- BB has a three-for-five reverse stock split?
- BB has a 8 percent stock dividend?
- BB has a 30.5 percent stock dividend?
- BB has a seven-for-four stock split?
- Determine the new number of shares outstanding in parts (a) through (d).
4. Define the following.
- Signaling hypothesis; clientele effect
- Residual distribution model; extra dividend
- Declaration date; holder-of-record date; ex-dividend date; payment date
- Dividend reinvestment plan (DRIP)
- Stock split; stock dividend; stock repurchase
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