What is the wacc for the firm for xyz inc

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Question 1: XYZ Inc. has 13.2 million shares of common stock outstanding. The firm also has 1,850,000 shares of 4.45 percent preferred stock which carry an annual dividend of $4.45 and 280,000 semi-annual bonds of $1,000 face value with a coupon rate of 6.95% outstanding. The bonds were issued three years ago with a maturity of 30 years. The common stock has a market price of $35 and its beta is 1.2, the preferred stock is selling for $102 per share, and the bonds are selling for 114% of par. The market risk premium is 5.6% and T-bills yield 2.9%. The firm pays taxes at 22 percent. What is the WACC for the firm?

Reference no: EM132869529

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