Wealth and Health Company is fully funded by common stock priced at an expected return of 15%. The price of common shares is $40/share. Earnings per share (EPS) is expected to be $6. If the company repurchases 25% of the common stock and replaces it with an equal value of debt that generates 6%, what is the expected value of earnings per share after refinancing? (Ignore taxes).

Answer rating: 100% (QA)

To calculate the expected value of earnings per share EPS after refinancing we need to consider the ... View the full answer