Palm Tree Corporation’s value of operations is estimated to be
$650 million. Palm Tree has $100 million in debt (it has no preferred stock) and 10 million shares of common stock outstanding. Suppose Palm Tree has decided to distribute to its shareholders $65 million, which it is presently holding in T-bills.
8.a Assume that Palm Tree has not yet made the distribution. What is Palm Tree’s intrinsic value of equity? (10 points) What is its intrinsic stock price per share? (5 points)
8.b Now, suppose that Palm Tree has just made the $65 million distribution in the form of dividends. What is Palm Tree’s intrinsic stock price per share right after this dividend payment? (15 points)
8.c Suppose instead that Palm Tree has just made the $65 million distribution in the form of a stock repurchase. How many shares did Palm Tree repurchase? (5 points) What is its intrinsic stock price per share right after the repurchase? (10 points)
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code “Newclient”
The post Palm Tree Corporation’s value of operations is estimated to be $650 million. Palm Tree has $100 million in debt (it has no preferred stock) and 10 million shares of common stock outstanding. Suppose Palm Tree has decided to distribute to its shareholders $65 million, which it is presently holding in T-bills. appeared first on Superb Professors.
Case study one page Case study one page Case study one page Case study one…
Business Calculus quiz that is 10 questions and has an hour time limit. Must be…
Write a 175- to 265-word response to the following: What constitutes “robust interoperability,†and what…
For this News Briefing Quest task , pick and analyze a U.S. political news article…
ACC 610 Milestone TwoGuidelines and Rubric This is the secondof three milestone assignments that will…
Please answer the questions in the attachment. I have sent you the required materials. Send…