What is epics stock price and book value per share

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Reference no: EM13892298

Epic Trucking's equity has a market value of $15 million with 700,000 shares outstanding. The book value of its equity is $9 million.

a. What is Epic's stock price per share? What is its book value per share?

b. If the company repurchases 25 percent of its shares in the stock market at their current price, how will this affect the book value of equity if all else remains the same?

c. If there are no taxes or transaction costs, and investors do not change their perceptions of the firm, what should the market value of the firm be after the repurchase?

d. Instead of a share repurchase, the company decides to raise money by selling an additional 20 percent of its shares on the market. If it can issue these additional shares at the current market price, how will this affect the book value of equity if all else remains the same?

Reference no: EM13892298

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