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Company XYZ has a capital structure that consists of debt, common stocks and preferred stocks. The...

Company XYZ has a capital structure that consists of debt, common stocks and preferred stocks. The company has issued 15-year, 12% semiannual coupon bond sells for $1,153.72. Its stock currently pays a $2 dividend per share and the stock’s price is currently $24.75. The company’s ROE is 15% and retaining 60% of its earnings.its tax rate is 35%; The weight of debt is 30%, weight of common equity is 40% and weight of preferred equity is 10%. The price of preferred stock is $47.50 a share. The company expects to pay a constant annual dividend of $3.80 a share. What is the company’s WACC?

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jeff jeffy answered 2 years ago
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