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MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
KMS Corporation has assets with a market value of $500 million, $50 million of which are cash. It has debt of $200 million, and 10 million shares outstanding. Assume perfect capital markets.
What is its current stock price?
If KMS distributes $50 million as a dividend, what will its share price be after the dividend is paid?
If instead, KMS distributes $50 million as a share repurchase, what will its share price be once the shares are repurchased?
What will its new market debt-equity ratio be after either transaction?
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