Reference no: EM132205361

ABC is a single business organization with a product structure. In 2017, ABC’s average stock price was $50 per share and it had 20 million shares of outstanding stock. ABC had net income of $150 million in 2017; projections show that net income will remain stagnant at approximately $150 million during 2018. ABC has never paid dividends to its stockholders but had excess cash of $90M at the end of 2017; the excess cash had accumulated over the past five years. ABC had a current ratio of 8 to 1 and a debt-to-assets ratio of 20% at the end of 2017. One of ABC’s strategic goals is to maximize stockholder wealth over the long term. An objective related to this goal is to increase average stockholder wealth by 10% by the end of 2018. Assume ABC’s average price-earnings ratio will remain the same in 2018. Based on ABC’s goal and objective 3 given above, adopt financial strategies/tactics to meet their objective in 2018. You must explain your answer in detail to get credit on this part of the assignment. You may use the Internet or other external resources to research the meaning of any terms in this question that you do not understand.