What is the expected eps

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1) Adelaide ltd. paid dividends per share of $2 in 2010. The firm's earnings per share had grown at 12% over the prior 5 years but the growth rate is expected to decline linearly over the next 8 years to 5%, while the payout ratio remains unchanged. The required rate of return is 8.30%.

The intrinsic value per share of this common stock is:

2) ABC Ltd, with 80 outstanding shares, has $100 in earnings after taxes. The firm is considering an on-market buy back for 20% of the shares at the market price of $15 per share. The management has decided to use the excess cash reserves which currently earns 7.5% interest after-tax, to finance this buy-back. What is the expected EPS if this buy-back goes ahead:

Reference no: EM132623651

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