What is the weighted average cost of capital for SKYE Corporation given the following information? Equity Shares Outstanding....... 1million Stock price per share....... $30.00 Yield to maturity on debt...... 7.68% Book value of interest bearing debt....... $10 million Coupon interest rate on debt....... 9% Interest rate on govenrment bonds..... 6% SKYE's equity beta...... 0.75 Historical Excess return on stocks...... 6.3% Tax rate...... 40%
What is the weighted average cost of capital for SKYE Corporation given the following information? Equity...
Given the following information for Stellar Corporation, find the WACC (weighted average cost of capital). Assume that the company's tax rate is 40%. Common Stock: 15 million shares outstanding, selling for $5 per share; the beta is 1.05 Preffered Stock: 5 million shares outstanding, selling for $4.5 per share, pays $ 0.9 annually per share. Debt: 1 million 8% quarter coupon bonds outstanding, $100 face value, 15 years to maturity, selling at par. Market: 6.5% market return and 4.5% risk-free...
Calculate weighted-average cost of capital for a firm with the following current conditions. Its marginal tax rate is 30.00%. It has 30 million shares of common stock outstanding that trade for $19.20/share. The yield to maturity on 10-year US Treasury Bonds is 3.00%. The firm's equity beta is 1.4. The expected return on the market is 11.00%. The firm's bonds have a 6.50%/yr. coupon rate and $1,000 face value, pay semiannual coupons, and mature in 15 years. There are 200,000...
You have the following information about Burgundy Basins, a sink manufacturer. Equity shares outstanding 20 million Stock price per share $ 30 Yield to maturity on debt 7.5 % Book value of interest-bearing debt $ 320 million Coupon interest rate on debt 3.5 % Market value of debt $ 200 million Book value of equity $ 320 million Cost of equity capital 10.0 % Tax rate 35 % Burgundy is contemplating what for the company is an average-risk investment costing...
You have been given the following facts and assumptions concerning ABC Corp. at December 31, 2013. Yield to maturity on long term government bond is 5.00%. Yield to maturity on company long term government bond is 7.0%.Coupon rate on company long term bond is 7.0%.Market price of risk is 8.0% along with estimated company beta value of 1.5.Stock is selling for $40 in the market and 250 million shares are outstanding. Assuming that book value of equity is $5240 million...
Use the following information about a firm to estimate the firm’s weighted average cost of capital. The firm has 4 million shares of common stock outstanding, trading at the price of $58 per share The firm currently has 175,000 shares of debt that are currently trading at $858 per share with a coupon payment paid semiannually at 5%, 7% yield to maturity, and 10 years to maturity with a par value of $1,000 The risk-free rate is 1.1% The expected...
For a large corporation, the annual cost of running business is called the Weighted Average Cost of Capital (or "WACC"). It is the average - or, more precisely, the weighted average of three things: cost of equity, cost of preferred stock, and cost of debt. Weighted Average Cost of Capital (a) Cost of preferred stock is nothing but the rate of return to investors buying common stock shares most recent dividend paid on each share of preferred stock 3 yield...
Weighted Average Cost of Capital (WACC) Apple Inc. has 5,366,166,000 shares traded at a market value of $126 per share; its debt outstanding has an estimated market value of $90,883,140,000. The stock has a beta of 1.193. The expected return on stocks is 8.78%. The firm is rated AAA and paid 30% of its income as taxes. The risk-free rate is 2.47%, and the yield-to-maturity of Apple’s bonds is 3.27%. A. What is Apple’s debt ratio? B. What is Apple’s...
I need help figuring out how to calculate cost of debt and equity. Question 2 Key facts and assumptions concerning Organic Grocery at Sept 30, 2018, appear below. Using this information, answer the questions following, as of October 1, 2018. Facts and Assumptions Organic Grocery (WF) Instructions: Yield to maturity on short-term government bonds Yield to maturity on long-term government bonds Coupon rate on WF long term bonds, annual payment Maturity, long term bonds Current bond price Market risk premium...
Consider the following information for Federated Junkyards of America.Debt: $75,000,000 book value outstanding. The debt is trading at 90% of book value. The yield to maturity is 9%.Equity: 2,500,000 shares selling at $42 per share. Assume the expected rate of return on Federated’s stock is 18%.Taxes: Federated’s marginal tax rate is Tc = 0.21.Calculate the weighted-average cost of capital (WACC). (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)Step-by-step, please!
[5] Weighted Average Cost of Capital (WACC) (25 points) Apple Inc. has 5,366,166,000 shares traded at a market value of $126 per share, its debt outstanding has an estimated market value of $90,883,140,000. The stock has a beta of 1.193. The expected retum on stocks is 8.78%. The firm is rated AAA and paid 30% of its income as taxes. The risk-free rate is 2.47%, and the yield-to-maturity of Apple's bonds is 3 2796. A. What is Apple's debt ratio?...