What is the earnings per share after the buyback

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The owners of H.M. Hornes Company are several wealthy Texans the company earned $ 3.5 million after taxes this year, with 1.0 Million shares outstanding, earnings per share were $ 3.50, shares have recently been sold for $ 72.00 among current shareholders . Two dollars of this value is explained by investors anticipation of a cash dividend. As Financial Manager of H.M. Hornes, you have completed the alternative of repurchasing some of the common shares of the company with a self-purchase offer at $ 72.00 per share

A. How many common shares could the company repurchase if you select this alternative

B. What is the earnings per share after the buyback?

C. What is the most convenient option between paying dividends in cash or buyback?

Reference no: EM132667041

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