Suppose Amazon.com, Inc. pays no dividends but spent $2.98 billion on share repurchases last year. If Amazons

Question:

Suppose Amazon.com, Inc. pays no dividends but spent $2.98 billion on share repurchases last year. If Amazon’s equity cost of capital is 7.6%, and if the amount spent on repurchases is expected to grow by 6.5% per year, estimate Amazon’s market capitalization. If Amazon has 474 million shares outstanding, what stock price does this correspond to?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Corporate Finance

ISBN: 9781292446318

6th Global Edition

Authors: Jonathan Berk, Peter DeMarzo

Question Posted: