Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Calculate the wacc for PG given the following: the company has outstanding debt that matures in 20 years that has a coupon of 9%. It pays interest semi-annually and the bon% premium to par is 1214.59. For a reference 20 year treasuries are yielding 3.5%. PG has outstanding preferred coupon, par value and is currently priced at $120. If new preferred was issued the company would incur flotation costs of 5%. The company's stock is currently priced at $100 and the current dividend is $3.00.That dividend is expected to grow at 3% forever. The beta of PG is 0.6 and the RFR and MRP are 3% and 7% respectively. Ignore flotation costs for your cost of equity.
The target structure is 60% equity, 30% debt and 10% preferred. The tax rate is 40%.
If the company had no residual cash and new issued equity would incur a flotation cost of 10%.Calculate a new the WACC using only the DCF method for equity and keeping all other factors the same. Comment on your findings
You are evaluating a growing perpetuity product from a large financial services firm. The product promises an initial payment of $24,000 at the end of this year and subsequent payments that will thereafter grow at a rate of 0.02 annually. If you use ..
Identify the best measure of risk for a stock held in a diversified portfolio?
Explain why the expansion of Sears, Roebuck & Co. into the financial services industry fails. Explain how the acquisition of NCR by AT&T is value-destructing.
Critically evaluate the following statement: “In recent years, it has been common for companies to experience significant stock price changes in reaction to announcements of massive layoffs. Critics charge that such events encourage companies to fire..
Holders of equity capital____.
Thornley Machines is considering a 3-year project with an initial cost of $660,000. The project will not directly produce any sales but will reduce operating costs by $400,000 a year. The equipment is depreciated straight-line to a zero book value ov..
What is the dividend yield on Watson's common stock?
Calculate Company B’s weighted average cost of equity, given the following information: (a) Dividend: $2.50, (b) Growth Rate: 5.2% (c) Price: $35.20, (d) Debt: $33,000,000, (e) Equity: $24,000,000, and (f) Preferred Stock: $5,000,000.
A company wants to raise $100 million on a new stock issue. According to their investment banker, a sale of new stock will require 8% under pricing and a 7% spread. Assuming the company’s stock price does not change from its current price of $100 per..
David's is saving for his retirement and as of today has accumulated the lump sum of $7348. David's goal is to retire at some time in the future (the unknown) with 9 times this amount. Assuming that all of David's current retirement money is invested..
You placed $6,559 in a savings account today that earns an annual interest rate of 5 percent compounded annually. How much will you have in this account at the end of 29 years. Assume that all interest received at the end of the year is invested the ..
Suppose the returns on long-term government bonds are normally distributed. Assume long-term government bonds have a mean return of 6.3 percent and a standard deviation of 9 percent.
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd