Cost of preferred stock-cost of preferred stock financing

Assignment Help Financial Management

Reference no: EM13850151

(Cost of preferred stock) The preferred stock of Gator Industries sells for $35.85 and pays $2.71 per year in dividends. What is the cost of preferred stock financing? If Gator were to issue 537,000 more preferred shares just like the ones it currently has outstanding, it could sell them for $35.85 a share but would incur floatation costs of $3.05 per share. What are the floatation costs for issuing the preferred shares and how should this cost be incorporated into the NPV of the project being financed? The firm’s cost of preferred stock financing is ___%

The Floation cost adjusted initial outlay for issuing the preferred shares are $______ ( round to the nearest dollar)

Reference no: EM13850151

Questions Cloud

Cash management is often the heart of the firm : Cash management is often the 'heart' of the firm in that a firm (just as would an individual or family) must assure that disbursements match-up with available and adequate cash. Consider two firms: The second firm is a manufacturer of industrial prec..

Calculate the npv and irr and mirr : the UPC scenario, and the new information above, calculate the NPV, IRR, MIRR, and payback periods from projects A and B. You must input all of your data into an Excel spreadsheet and show all formulas.

What constant annual interest rate were you earning : If you deposit $2,000 into a bank account at the end of each of the next 10 years and it has grown to $27,633, what constant annual interest rate were you earning?

Estimate the libor zero rates for maturities : The LIBOR zero curve is flat at 4% (continuously compounded) out to 2 years. Swap rates for 3- and 4-year annual pay swaps are 4.5% and 5%, respectively. Estimate the LIBOR zero rates for maturities of 3 and 4 years. Give your answers as annual rates..

Cost of preferred stock-cost of preferred stock financing : The preferred stock of Gator Industries sells for $35.85 and pays $2.71 per year in dividends. What is the cost of preferred stock financing? What are the floatation costs for issuing the preferred shares and how should this cost be incorporated into..

Determine who may have legal liability for the fire : Determine whether B&B Bouquets has coverage for the allegations made in the lawsuits and other claims made against them. Determine who may have legal liability for the fire

Change in the face of countervailing policies : In doing so the states have brought one underground market to the surface. At the same time these states impose heavy taxes upon the drug. How would you expect the GDPs of these two states to change in the face of such countervailing policies?

Addition to price-weighted and value-weighted indexes : In addition to price-weighted and value-weighted indexes, an equally weighted index is one in which the index value is computed from the average rate of return of the stocks comprising the index.

Stock investment refers to borrowing part of purchase price : Margin on a stock investment refers to borrowing part of the purchase price. Would you want to do this? Why or why not? In your answer, make sure you discuss how investing on margin affects the potential risk and return on the investment.

User Account

All Pages