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Earnings per share and the price earnings

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Blue Corp. is evaluating an extra dividend versus a share repurchase. In either case, $4,000 would be spent. Current earnings are $0.93 per share and the stock currently sells for $37 per share. There are 1,800 shares outstanding. Ignore taxes and other imperfections.

If Blue Corp. pays a dividend, what will be the dividend per share? After the dividend is paid, how many shares will be outstanding and what will the price per share be?

Dividend=$2.22

Outstanding shares= 1800

stock price=$34.78

After the $2.22 dividend, the price falls to $34.78 per share. What are earnings per share (EPS) and the price earnings (P/E) ratio? Enter your answers rounded to 2 DECIMAL PLACES.

Please show formulas and calculations

Reference no: EM133058305

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