What is cost of common equity and wacc

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Palencia Paints Corporation has a target capital structure of 25% debt and 75% common equity, with no preferred stock. Its before-tax cost of debt is 11%, and its marginal tax rate is 40%. The current stock price is P0 = $32.00. The last dividend was D0 = $4.00, and it is expected to grow at a 8% constant rate. What is its cost of common equity and its WACC? Palencia Paints Corporation has a target capital structure of 25% debt and 75% common equity, with no preferred stock. Its before-tax cost of debt is 11%, and its marginal tax rate is 40%. The current stock price is P0 = $32.00. The last dividend was D0 = $4.00, and it is expected to grow at a 8% constant rate. What is its cost of common equity and its WACC?

Reference no: EM131965965

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