What is the company equity weight

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BigSky, Inc., has 7.1 million shares of common stock outstanding. Current share price is $62.10, and the book value per share is $5.10. The company also has two bond issues outstanding. The first bond issue has a face value of $71.1 million, a coupon rate of 7.1 percent, and sells for 92.5 percent of par. The second issue has a face value of $36.1 million, a coupon rate of 7.6 percent, and sells for 91.5 percent of par. The first issue matures in 21 years, the second in 13 years. The most recent dividend was $3.40 and the dividend growth rate is 7 percent. Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues. Both bonds make semiannual payments. The tax rate is 34 percent.

What is the company’s cost of equity

What is the company’s aftertax cost of debt

What is the company’s equity weight

What is the company’s weight of debt

What is the company’s WACC

Reference no: EM131355083

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