?Many companies use stock repurchases to increase earnings per share. For example, suppose that a company is
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?Many companies use stock repurchases to increase earnings per share. For example, suppose that a company is in the following position:
The company now repurchases 200,000 shares at $200 a share. The number of shares declines to 800,000 shares and earnings per share increase to $12.50. Assuming the price?earnings ratio stays at 20, the share price must rise to $250.? Discuss.
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Related Book For 
Principles of Corporate Finance
ISBN: 978-0072869460
7th edition
Authors: Richard A. Brealey, Stewart C. Myers
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