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In: Finance
Filer Manufacturing has 9 million shares of common stock outstanding. The current share price is $81,...
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Filer Manufacturing has 9 million shares of common stock outstanding. The current share price is $81, and the book value per share is $8. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $80 million, has a 10 percent coupon, and sells for 96 percent of par. The second issue has a face value of $50 million, has a 11 percent coupon, and sells for 104 percent of par. The first issue matures in 25 years, the second in 8 years. |
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The most recent dividend was $5.3 and the dividend growth rate is 5 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 35 percent. |
| Required: |
| What is the company's WACC? (Do not round your intermediate calculations.) |
Solutions
jeff jeffy answered 10 months agoRelated Solutions
Filer Manufacturing has 9 million shares of common stock outstanding. The current share price is $81,...
Filer Manufacturing has 9 million shares of common stock
outstanding. The current share price is $81, and the book value per
share is $8. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $80 million
and a coupon rate of 10 percent and sells for 96 percent of par.
The second issue has a face value of $50 million and a coupon rate
of 11 percent and sells for 104 percent of...
Filer Manufacturing has 7 million shares of common stock outstanding. The current share price is $86,...
Filer Manufacturing has 7 million shares of common stock
outstanding. The current share price is $86, and the book value per
share is $5. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $70 million,
has a 9 percent coupon, and sells for 96 percent of par. The second
issue has a face value of $45 million, has a 10 percent coupon, and
sells for 104 percent of par. The first issue...
Filer Manufacturing has 5 million shares of common stock outstanding. The current share price is $84,...
Filer Manufacturing has 5 million shares of common stock
outstanding. The current share price is $84, and the book value per
share is $7. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $60 million,
has a 7 percent coupon, and sells for 94 percent of par. The second
issue has a face value of $35 million, has a 8 percent coupon, and
sells for 107 percent of par. The first issue...
Filer Manufacturing has 8.2 million shares of common stock outstanding. The current share price is $52,...
Filer Manufacturing has 8.2 million shares of common stock
outstanding. The current share price is $52, and the book value per
share is $5. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $70 million,
an 8 percent coupon, and sells for 104 percent of par. The second
issue has a face value $50 million, a 7.5 percent coupon, and sells
for 97 percent of par. The first issue matures in 10...
Filer Manufacturing has 10 million shares of common stock outstanding. The current share price is $82,...
Filer Manufacturing has 10 million shares of common stock
outstanding. The current share price is $82, and the book value per
share is $5. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $85 million,
has a 5 percent coupon, and sells for 97 percent of par. The second
issue has a face value of $55 million, has a 6 percent coupon, and
sells for 105 percent of par. The first issue...
Filer Manufacturing has 8.2 million shares of common stock outstanding. The current share price is $52,...
Filer Manufacturing has 8.2 million shares of common stock
outstanding. The current share price is $52, and the book value per
share is $3. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $69.8 million
and a coupon rate of 6.9 percent and sells for 108.4 percent of
par. The second issue has a face value of $59.8 million and a
coupon rate of 7.4 percent and sells for 108.7 percent of...
Dinklage Corp. has 9 million shares of common stock outstanding. The current share price is $81,...
Dinklage Corp. has 9 million shares of common stock outstanding.
The current share price is $81, and the book value per share is $7.
The company also has two bond issues outstanding. The first bond
issue has a face value of $130 million, a coupon rate of 6 percent,
and sells for 92 percent of par. The second issue has a face value
of $115 million, a coupon rate of 5 percent, and sells for 103
percent of par. The...
Filer Manufacturing has 4100000 shares of common stock outstanding. The current share price is $55.99, and...
Filer Manufacturing has 4100000 shares of common stock
outstanding. The current share price is $55.99, and the book value
per share is $5.70. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $70000000,
has a 0.05 coupon, matures in 10 years and sells for 83 percent of
par. The second issue has a face value of $65000000, has a 0.06
coupon, matures in 20 years, and sells for 92 percent of par....
Filer Manufacturing has 7,034,720 shares of common stock outstanding. The current share price is $65.32, and...
Filer Manufacturing has 7,034,720 shares of common stock
outstanding. The current share price is $65.32, and the book value
per share is $3.05. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $79,113,079,
has a 0.07 coupon, matures in 12 years and sells for 81 percent of
par. The second issue has a face value of $62,515,482, has a 0.08
coupon, matures in 9 years, and sells for 84 percent of par....
Filer Manufacturing has 4500000 shares of common stock outstanding. The current share price is $69.11, and...
Filer Manufacturing has 4500000 shares of common stock
outstanding. The current share price is $69.11, and the book value
per share is $9.62. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $53000000,
has a 0.05 coupon, matures in 10 years and sells for 83 percent of
par. The second issue has a face value of $58000000, has a 0.06
coupon, matures in 20 years, and sells for 92 percent of par....
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