Suppose Pfizer announced it is pulling Viagra from the market due to newly discovered negative side effects.
Fantastic news! We've Found the answer you've been seeking!
Question:
Suppose Pfizer announced it is pulling Viagra from the market due to newly discovered negative side effects. As a result, Pfizer's future expected cashflow will decline by $850 million each year for the next 10 years.Assume Pfizer has 500 million shares outstanding, and its required rate of return is 8%. If the news came as complete surprise to investors, what should happen to Pfizer's stock price upon the announcement?
Posted Date: