1.Calculated WACC

2.How data was used to calculate WACC (This would be the formula and the formula with your values substituted)

3.One or two paragraph of how much confidence you have in your answer. What were the limiting assumptions that you made, if any.

***Assignment Information, Stock Information and Bond Information for chosen company is attached.

Bonds Detail 2 of 3 http://finra-markets.morningstar.com/BondCenter/BondDetail.jsp?ticke... UNITEDHEALTH GROUP INC 5.375% 03/15/2016 Coupon Rate Maturity Date + ADD TO WATCHLIST Symbol CUSIP Next Call Date Callable Last Trade Price Last Trade Yield Last Trade Date US Treasury Yield UNH.GQ 91324PAQ5 $101.88 .000% Trade History Price/Yield Chart Price Chart 03/01/2006 Price 10/09/2015 Prospectus Yes Classification Elements Bond Type Yield Chart Zoom: 5D 1M 3M YTD 1Y 3Y 5Y 10Y Max - 10/09/2015 Debt Type Industry Group US Corporate Debentures Industrial Industry Sub Group Service/Leisure Sub-Product Asset Type Corporate Bond Sub-Product Asset State Use of Proceeds Security Code Special Characteristics Medium Term Note CORP N Issue Elements 2006 2008 2010 2012 Offering Date 2014 2015 Dated Date First Coupon Date Original Offering* Credit and Rating Elements Moody's Rating A3 (03/30/2015) Standard & Poor's Rating A+ (11/03/2014) Fitch Rating A- (08/06/2015) TRACE Grade Investment Grade Default Bankruptcy N Insurance Pre-Refunded/Escrowed Mortgage Insurer Additional Description Senior Unsecured Note Call Date Put Date Call Price Put Price Series Issue Description Project Name Payment Frequency Day Count Form Depository/Registration Security Level Collateral Pledge Capital Purpose *dollar amount in thousands Put & Redemption Provisions Amount Outstanding* Call Frequency Continuously Put Frequency 02/27/2006 03/02/2006 09/15/2006 $750,000.00 $600,594.00 Semi-Annual 30/360 Book Entry Depository Trust Company Senior Bond Elements Original Maturity Size* Amount Outstanding Size* Yield at Offering Price at Offering Coupon Type Escrow Type *dollar amount in thousands 750,000.00 600,594.00 5.42% $99.62 Fixed 10/9/2015 8:56 PM Task Your task is to determine the WACC for a given firm using what you know about WACC as well as data you can find through research. Your deliverable is to be a brief report in which you state your determination of WACC, describe and justify how you determined the number, and provide relevant information as to the sources of your data. Your research is to be independent from any information you may find at thatswacc.com or similar sites although you might want to use such sites to provide a reasonableness check on the WACC you calculate. Assumptions As you recall, the formula for WACC is rWACC = (E/E+D) rE + D/(E+D) rD (1-TC) The formula for the required return on a given equity investment is ri= rf + i * (RMkt-rf) RMkt-rf is the Market Risk Premium. For this project, you may assume the Market Risk Premium is 4% unless you can develop a better number. rf is the risk free rate. The YTM on 10 year US Treasury securities is a good approximation. You may assume a corporate tax rate of 40%. One good source for financial data for companies as well as data about their equity is http://finance.yahoo.com. By looking around this site, you should be able to find the market capitalization (E) as well as the for any publicly traded company. There are not many places left where data about corporate bonds is still available. One of them is http://finra-markets.morningstar.com/BondCenter. To find data for a particular company's bonds, find the Quick Search feature, then be sure to specify corporate bonds and type in the name of the issuing company. This should give you a list of all of the company's outstanding bond issues. Clicking on the symbol for a given bond issue will lead you to the current amount outstanding and the yield to maturity. You are interested in both. The total of all bonds outstanding is D in the above formula. If you like, you can use the YTM on a bond issue that is not callable as the pre-tax cost of debt for the company. Deliverable Write a two page report that contains the following elements: 1. Your calculated WACC. 2. How data was used to calculate WACC. This would be the formula and the formula with your values substituted. 3. Sources for your data. 4. One or two paragraph of how much confidence you have in your answer. What were the limiting assumptions that you made, if any.