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Stock repurchase

Intelligent Industries is offering to repurchase the preferred stock that it issued in 1995. The stock has a dividend of $3.00 a share. The yield has increased as the fortunes of the company have risen. Now in 2006 the yield is 10%. In 1995 it was only 5%. The has offered to recall the stock for $55.00. Would you accept that offer give the stocks current value. Given the stocks original price how much money will you make or loose if you sell?

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Intelligent Industries is offering to repurchase the preferred stock that it issued in 1995. The stock has a dividend of $3.00 a share.  The yield has increased as the fortunes of the company have risen.  Now in 2006 the yield is ...

Solution Summary

Calculates stock price to evaluate the repurchase offer of the company

$2.19