The company CASA DE LAS HERRAMIENTAS, SA has 5,000 shares in circulation whose price is $140 per

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The company CASA DE LAS HERRAMIENTAS, SA has 5,000 shares in circulation whose price is $140 per share. The company expects to pay a dividend of $20 per share next year and thereafter expects the dividend to grow indefinitely at 5% per year. The president of the company announces by surprise that, from now on, the company will distribute half of the treasury in the form of dividends and the rest will be used in the repurchase of shares. a) What is the total value of the company before and after the announcement? What is the value of the share? What is the expected dividend flow per share for an investor who plans to hold his stock rather than sell it to the company? Check its estimated value per share, discounting the dividend flow per share.

Posted Date: May 10, 2024 01:56 AM

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The company CASA DE LAS HERRAMIENTAS, SA has 5,000 shares in circulation whose price is $140 per

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