HQ Company is considering a 1-for-3 reverse stock split. HQs stock is currently selling for $3 per

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HQ Company is considering a 1-for-3 reverse stock split. HQ’s stock is currently selling for $3 per share.
a. What will the price of the stock be after the stock split?
b. HQ plans to pay a dividend equal to $0.60 per share after the split. The company would like to pay an equivalent dividend per share even if the split does not take place. What would the per-share dividend have to be if the HQ doesn’t split the stock?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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Related Book For  answer-question

Essentials of Managerial Finance

ISBN: 978-0324422702

14th edition

Authors: Scott Besley, Eugene F. Brigham

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