What is the company market capitalization

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Reference no: EM131309729 , Length: 2

ABM Company has 50 million shares outstanding. If ABM's shares are trading at $19.16 per share,

(i) What is the company's market capitalization (value of equity?). Assuming the market value of debt equal today's book value of debt;

(ii) What percentage of the company's enterprise value is attributable to debt and what percentage is attributable to equity, Using these weights;

(iii) Compute the weighted average cost of capital. Assume the pretax cost of debt is 8%, the cost of equity 12% , and the marginal tax rate is 25 percent. The company has on its balance sheet as of today is $200 million in debt and $308.5 million in equity.

2 pages.

Reference no: EM131309729

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