What is kellogg total market capitalization

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Question - Estimating the Weighted Average Cost of Capital - Kellogg Company manufactures cereal and other convenience food under its many well-known brands such as Kellogg's®, Keebler®, and Cheez-It®. The company, with over $13.5 billion in annual sales worldwide, partially finances its operation through the issuance of debt. At the beginning of its 2018 fiscal year, it had $8.25 billion in total debt. At the end of fiscal year 2018, its total debt had increased to $8.72 billion. Its fiscal 2018 interest expense was $287 million, and its assumed statutory tax rate was 21%. Kellogg Company has an estimated market beta of 0.85. Assume that the expected risk-free rate is 2.1% and the expected market premium is 5%.

Kellogg's stock closed at $57.01 on December 31, 2018. On that same date, the company had 420,666,780 shares issued, of which 76,801,314 shares were in treasury.

Required -

a. What is Kellogg's total market capitalization as of December 31, 2018?

b. Compute Kellogg's WACC.

Reference no: EM133167270

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