Calculate wacc for parrothead enterprises

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Reference no: EM131923611

You are given the following information concerning Parrothead Enterprises: Debt: 9,100 6.3 percent coupon bonds outstanding, with 24 years to maturity and a quoted price of 104.25. These bonds pay interest semiannually. Common stock: 230,000 shares of common stock selling for $64.60 per share. The stock has a beta of .86 and will pay a dividend of $2.80 next year. The dividend is expected to grow by 5.1 percent per year indefinitely. Preferred stock: 8,100 shares of 4.55 percent preferred stock selling at $94.10 per share. Market: An expected return of 11.9 percent, a risk-free rate of 5.05 percent, and a 34 percent tax rate. Calculate the WACC for Parrothead Enterprises. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC

Reference no: EM131923611

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